Buy a good example whatever you do! Paying a premium for a mint example is money very well spent.
Do a search their is enough info about he W126 around here to keep you reading for months!
Since you are interested in the gas models search "timing chain". Chances are unless you find records indicating it has been changed, guess who is changing it?
I think a 420SEL offers the best blend of economy and power. The 560's are great but they do burn more fuel.