Everything that I have read says that the A/C on these cars is only completely off in economy mode. Otherwise it is set to run a little or a lot to decrease humidity. The lack of heat to overcome the A/C can be related to bad thermostat, plugged heater core, broken/ripped monovalve diaphram, or auxiliary heater pump problems.

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1961 190Db retired
1968 220D/8 325,000
1983 300D 164,150