That certainly can be a DIY job. Not the first I'd tackle though...

Just over a year ago, I replaced the cylinder head, oil pump chain, timing chain, and vacuum pump onan '85 300SD. I did it all in the winter, in my yard, and without a hoist.

No machine shop is needed.

If you are determined, you can do it. Make sure you get a service manual. Haynes, MB, or the CD (eBay).

An make make sure it really does need a head gasket. Are you sure the oil is not from somewhere else?

__________________
Michael LaFleur

'05 E320 CDI - 86,000 miles
'86 300SDL - 360,000 miles
'85 300SD - 150,000 miles (sold)
'89 190D - 120,000 miles (sold)
'85 300SD - 317,000 miles (sold)
'98 ML320 - 270,000 miles (sold)
'75 300D - 170,000 miles (sold)
'83 Harley Davidson FLTC (Broken again) :-(
'61 Plymouth Valiant - 60k mikes
2004 Papillon (Oliver)
2005 Tzitzu (Griffon)
2009 Welsh Corgi (Buba)