I'm thinking about replacing my O2 sensor but should I?

About a month ago the check engine light came on and two codes came up, #2 and #26 or #27, can't remember. Anyway #2 is a bad O2 sensor.

Right after the light came on I reset it and it hasn't been on since but since my car has almost 160k miles on it and I don't think it's been replaced should I just go for it?

I've also got my smog test coming up and I'm afraid that if it is bad then I'll probally fail for sure.

The car runs good and the gas mileage has slightly decreased but it's still averages 20mpg, but it could be my driving habits.

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1992 Mercedes-Benz 400E
2002 Mercedes-Benz ML500