I would like some opinions on what this problem might be.

I recently bought a used 260E that has a blown head gasket, I know I am so stupid not to know it when I bought it. After discussing with my mechanic we decided to put a used engine in it rather than try to fix the head gasket (as we don't know if the previous driver kept driving the car after the blown gasket, so fixing it might not have been worth while). Actually I regret not trying to fix the head gasket instead, read more below.

Long story ... short, I got the car back now, and it seems to run ok in the city, but once on the highway it start shaking as I drive the car faster. Once it gets to about 105km/hr (~ 60miles/hr) (rpm meter reads 3000) the car shakes from the engine compartment like you wouldn't believe. The steering wheel shakes so much it feels like my hands would shake loose from the wheel. So now I am such a nice obedient driver, never a speeder anymore cause I can't drive the car more than a 105km.

I called the mechanic, he says maybe I need a wheel alignment. I mentioned that it drives fine in the city. He also mentions that the car needs to have the 2 wheel bearings in the back replaced. But really the problems is in the front, not the back. It definitely vibrates from teh engine compartment.

I don't know what to do. Should I try to sell the car and cut my loss? Or should I dump more money in the car to see if it will fix the vibrations? I know I refuse the keep the car if all I can drive at is 105km/hr, what's the point?

Now the question: What could it be? Is the 2 wheel bearings at the back the culprit? Could it be a shoddy work when they pop in the replacement used engine? Is there any hope?