Do a search on vacuum diagrams and take it with you to verify everything is in there. I learned the hard way with posts asking 'What the ... is this part?"
Water in the rear: My 300SD had a small hole in the rear portion of the lower door sill which flooded the floor.
Diesel Secret: Snake oil. The previous owner (PO) sounds iffy. (AC issues vs. knowledge, snake oil scams). LOOK AT EVERYTHING!
If your interested in bio fuel, be prepared to read till your eyeballs are red. Lots of crap out there. Look for sites with a proper $ trail to know exactly the costs. Best advice I can give you on bio or alternative fuel: get the best oil to start with, settle to remove water and only heat oil when needed (processing), size your filtration system around your collection.
Back to the MB: Sounds like you could easily put $2500 in this beast to make her proud again NOT counting paint. Sounds very much like my owner (300SD). I should have waited for a better MB and one that better fits my needs. PO lied like a pollitician just before sentencing.
One way to get the MB lust out of your eyes is to take the car to a used car dealer and ask what they'd give you for the beast.
So goes life. You never truly know till afterwards!