"I read in car and driver that the 06 ML350 with the increase in HP and addition of the 7sp auto trans was as quick or quicker than the old (163) ML430 while getting much better fuel economy"

Got to disagree. The '99 ML430 "officially" gets 15city 18Hwy. miles to the gallon. The car and driver test says that the new '06 ML350 gets 16 city and 20 Hwy. Not exactly a big difference. In addition, in my 1999 ML430, I get a little better mileage than that (about 18-19 combined) while C/D says that in their test they got 17 mpg combined "observed" in the '06 350. While you would think that the 350's (in all the MB lines) would be more efficient than their v-8 counterparts, they ironically work out to be anything but. In fact, I beleive that the disclosed MPG on the 04/05 ML350's was actually WORSE than the mileage (disclosed) of the old ML 430's.

I believe part of the efficency problem is due to the fact that to make good power, the 350's must be reved higher (hence the 7 speed boxes). The torque of the 430's gets you up to speed without having to rev it high.

My thoughts, for what they are worth.