For best reliability and ease of installation the 240D engine would be the simplest. And the engine was probably the most bullet proof engine Mercedes made. No electronics. Simple in design and small.
Considerations.
It uses vacuum for some applications. The majority of the vacuum tubing you see over the top of the engine would be required. Once you get engine we can help you with eliminating some.
Transmission. With correct mounts is can be installed
Drive shaft. This company changes Mercedes drive shaft to universal joint design. so with your welding experience, I'm sure that you can convert the drive shaft
http://driveshafts.com/
I don't think you will have any problems doing this project. The 240D gets about 25-28MPG in city and 30-32 hwy. Just remember it's 67HP with a 0-60 time of 22 seconds.
Let us know how it goes.
Dave
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1970 220D, owned 1980-1990
1980 240D, owned 1990-1992
1982 300TD, owned 1992-1993
1986 300SDL, owned 1993-2004
1999 E300, owned 1999-2003
1982 300TD, 213,880mi, owned since Nov 18, 1991- Aug 4, 2010 SOLD
1988 560SL, 100,000mi, owned since 1995
1965 Mustang Fastback Mileage Unknown(My sons)
1983 240D, 176,000mi (My daughers) owned since 2004
2007 Honda Accord EX-L I4 auto, the new daily driver
1985 300D 264,000mi Son's new daily driver.(sold)
2008 Hyundai Tiberon. Daughters new car
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