At this point I think condition, mileage, and service records are of greater significance than which engine is chosen. I currently own one of each - a 1993 300E 2.8 and a 2001 E320 wagon. In normal driving they are almost indistiguishable - perfectly smooth, responsive, and quiet. Add a bit of throttle and they both get aggressive, pulling hard at upper RPMs with a sporting growl. Different notes, of course, an I6 doesn't sound like a V6.

In terms of repairs, the M104 has required both a head gasket and engine wiring harness prior to 100K miles. As I understand it, the engine wiring harness is not a concern in a 96/97 model year car.

The M112 hasn't needed any repairs. Of course, it's only 7 years/55K miles old.

The professional techs on the site do report occasionally reringing the M112/M113 V6/V8 engines. So far I haven't seen any data points that correlate, or not, this failure with use of conventional oils. I don't know whether this failure occurs to the unlucky or only those that don't follow proper maintenance procedures. I can recall 2 occurances of folks on this site that needed new rings.

The 722.6 five speed automatic is a nicer driving transmission than the earlier four speed. It has a better selection of gear ranges, and is more cooperative in choosing the correct gear. It delivers better fuel mileage because it has an overdrive top gear and a lockup torque converter. But unless you can afford a late 99 or 2000 model year, when all the updates were incorporated, I wouldn't recommend it over the earlier transmission.

My long and rambling $.02,

- JimY