I have a 1995 S-350 with 167,000 miles. The only problem I have is what I think is excessive blowby. Have not done a compression test yet. The car was using oil (one quart every 750 miles) and I had the turbo overhauled. At the same time I disconnected the EGR and routed the blowby tube to the bottom of the car and started using synthetic Rotella.
http://www.peachparts.com/shopforum/showthread.php?threadid=25487&highlight=egr
I am now going 1500-2000 miles before adding a quart. I have heard that the later 3.5 engines had different rods and what not in them. Donnie might can shed some light on this. As I have stated before I think one of the main problems with this engine is the crud from the EGR that the engine eats. I mean big chunks of oily, sooty, black, hard, junk. Most of it goes down #1 and 2 intake runners. Where the bent rods are found. It is my theory that some of this hard crud gets eaten under full throttle and could possible bend a rod a little and start the egg shaping of the cylinder wall. Only speculation. I don't know if the '91 engines even had EGR or not. Only time will tell on my engine and I plan to keep it either until I die or Mercedes starts importing another S-Class diesel. I know I will get some flak about this but in my opinion it is the best, most comfortable, roomy, powerful, efficient (for its size) diesel Mercedes has ever built. It will run a certified 118 mph and gets from 24-30 mpg depending on how it is run. The later model E-Class is a nice car but it does not have enough room for my family. I needed the larger car.