I had the opposite problem -- no heat. Fixed it with a new MB thermostat.
I'd never use anything buy an OEM thermostat -- all the aftermarkets I've seen don't work properly.
Normal temp is about a needle width above the 80C mark -- shouldn't go above that this time of year.
Replace the coolant tank cap with an MB 20 psi one. Some aftermarkets are OK, most are not (I had a coolant loss/high running temp problem with the 300TE due to a bad cap).
Otherwise, check for high coolant pressure cold -- if there is significant pressure in the coolant tank on a cold engine, the head gasket has blown or the head cracked
. Usually there will be oil in the coolant, too if this is the case.
The only other causes I can think of are very fast IP timing (hard to set on these cars), a collapsed hose, restricted circulation of coolant (is it possible to get the head gasket on upsidedown?) or, the cheap fix A BAD SENDING UNIT!!!
I've seen more than one go bad when the engine overheated, reading high all the time. The one on my sister's Volvo pegged out after she blew the head gasket and toasted the head. I'm sure yours wasn't that hot (I had to replace the head), but they do go bad. Cheap to replace, too. Loose wire will do the same thing.