I fail to see why a 124 wagon will do but an 850 wagon will not-I would have thought the Volvo was bigger! The 124 bodies are aging too, something that will effect its overall reliability. To buy a newer Mercedes wagon will cost some big dough! I would recommend the Volvo again, he is used to their quirkiness and driving habits. There are alot more of them available compared to Benz wagons too, hence lower price.
What about a Toyota Camry wagon? They have excellent ratings and were made during that time frame.