I am here to research the same problem on a 97 E300D. This is the same as your friends. I had a leak on the plastic fuel lines. My shop in HB CA replaced all of my lines and shut off valve ect.
Car ran like a champ. I am often on the road and my Benz sat in a drive way on a incline. I came home a month later and found small circle the size of your palm -of diesel. Car would not start. After jumping it and taking life off of the starter- it started. It ran rough for 5 minutes. I drove it for a week without issue. It also did not have anymore leaking (present in Driveway), but it smelled of diesel. Then I went on the road for a few weeks. Came back same dam problem. No engine code. This car only has 70K miles and I have factory service record for 65K of those miles. The Glow plugs were replaced at 61K so I know this is not my issue. Called the guys back in HB and they told me Air was the problem. Sure enough I popped the hood, and I could see air in my new clear fuel lines (the front one). So, this leak is not one way. A little diesel comes out and air goes in. I removed my window fluid resivore to get my head in there. I noticed I have a slight leak under my shut off valve. I am in phoenix and not southren Cal- other wise I would have the shop fix this for free, as they installed it. Does anyone know if there is an o-ring in this unit? Since its new I would suspect its okay- What is the torq spec? On another note, I can also smell the leak when you get out of the car.

Bill