Chuck is completely right, but here are some specific considerations:
A wagon requires a pump to handle the pneumatic rear suspension. An OM617 for a wagon has a specific cylinder head that accommodates the pump. An OM617 for a sedan won't accept the pump. I don't know if this is an issue with the M103. But I understand there are ways to convert a W123 wagon to conventional springs.
The M103 uses Bosch KE-Jetronic fuel injection which is an enhanced version of continuous injection system. The aftermarket fuel injection controllers I've heard of work more like the Bosch L-Jetronic family which is a pulsed injection system. K-Jetronic is very adaptable (I know of a VW Vanagon successfully converted from LJ to KJ, but why?) so it's not impossible. I believe your M110 uses an older version called K-Jetronic with lambda.
You might be able to adapt the fuel injection of the M110 to the M103. This would negate the need for a computer since the M110 doesn't need one (right?). Will the M110 mixture box and fuel distributor sit on the M103 manifold and throttle body? I'm guessing the fuel needs of the two engines are close enough to make this work. but this is still probably easier said than done.
There's considerable transitivity in your favor. The M110 was available in the W123 and W126. The M103 was available in the W126. One could then assume that the M103 would fit in a W123. The same logic suggests that an M117 would also fit in a W123. Now that would be a swap >
And the M102 was available in the W123. An M102 is essentially 2/3s of an M103 so there may be more shortcuts.
Someone who posts here recently and successfully replaced the M103 in his 88 300TE with an M104 out of a C36. Outside of the fact that he swapped in essentially the same block, I have to think that the ancillaries are a bigger nightmare when converting to a non MB (AMG) engine.
Let us know what you decide.