I'd like to try this rear end swap if it's doable. According to this page the '91-'92 W124 300CE has a 3.07 final drive ratio, which I am thinking would be the sweet spot for mileage and performance in my undergeared W126 '91 300SEL (currently 3.47 ratio IIRC). Will the W124 parts match up, or can special brackets be found or made?

it was my site you linked to, Mercedes-Benz turbo

but i do not think there is a straight swap, althou i havent tried myself...
have another guy here in sweden that are going to try and transplant the innards of a 3.07 w124 differential into his genII w126 diff, i can get you a picture of a genII w126 differential and a w201 differential (the w201 apperantly quite alike the w124)
but changing the innards of a differential is a heck of a job...

>> W126 rear diff swap << - Mercedes-Benz Forum

one perhaps better option you have is getting a gen1 w126 differential with the proper gearing and swaping out the entire subframe... or getting a w126 genII diesel differential, will swap straight away and give you a ratio of 2.88.... if you can find one of those...

(i might be stepping out on a limp here, but perhaps changing the innards of a 3.07 w123 differential is a possibility... instead of a w124)

best regards
/swampmonkey...

( a 380SE gen1 w126 has 197bhp and runs a 2.47 rearend, not to far from your powernumbers, if you are not looking for fast acceleration but good highwaycruicing, you could change the differential to a 2.47 genII, a diff from any v8, althou you would have to change the flange/yoke, and that is a heck of a job...)