Very common problem with old 300es is a loose cylinder head.This will cause the problems that you discribed as the compression pressure leaking will force the water out past the radiator cap.The car should run at 90 degrees centigrade. Have a mechanic retorque the head cold to 60 foot pounds.Usually this will fix the problem. Otherwise a headgasket replacement is called for.
Check/replace radiator cap .You are probably pumping the water out so that car is always low on water.