Here in Sydney we don't have much need for the "anti-freeze" properties of coolant either, but I would not consider running our cars without it. The anti-corrosion properties are still very much needed and I always use genuine MB coolant (we get the blue German stuff here) at a concentration of 50%. If you have been running without the correct coolant then your leak may be the head gasket. On these engines the head gasket appears to behave like a sacrificial anode. Whenever I have had to replace a head gasket they appear badly corroded, possibly due to poor coolant maintenance at some time during the life of the engine.

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107.023: 350SLC, 3-speed auto, icon gold, parchment MBtex (sold 2012 after 29 years ownership).
107.026: 500SLC, 4-speed auto, thistle green, green velour.
124.090: 300TE, 4-speed auto, arctic white, cream-beige MBtex.
201.028: 190E 2.3 Sportline, 5-speed manual, arctic white, blue leather.
201.028: 190E 2.3, 4-speed auto, blue-black, grey MBtex.
201.034: 190E 2.3-16, 5-speed manual, blue-black, black leather.