I have the same model '96 E320. In the morning (when cold), it revs at 1000-1100 rpm them after that (more than 30 secs) it would drop to 600-700 rpm, so I think it's normal for your car. Not sure when was the last time that you have your spring perches checked, if you have not done so, please have them checked. Mine were rusted out, almost departed from the chassis, MB fixed them at no cost. This is a safety issue and there is no recall, MB will fix it case by case. Good luck