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1- While the old iron-head engines through 1985 are more bulletproof, the aluminum-head versions are not ALL prone to warping or cracking! Only the 1987 3.0L had problems with cracking, it was due to two things. One was the trap oxidizer which MB later recalled and will replace free. Two was a design flaw in the original head, later engines got the updated head. NONE of the other OM60x engines had head problems. Don't worry about it.
2- The 90-95 OM603.97x 3.5L engines had bottom end problems. This was only on the 3.5L, no other models were affected. This engine was only used in the 1990-95 S-class, so it doesn't apply to the 98-99 you're inquiring about.
3- Although it seems like it, and I used to think this too, the 98-99 turbo diesels are NOT "CDI" engines! Mercedes has never imported a true CDI into the USA in a Mercedes vehicle. They did import their CDI engine for use in the Freightliner Sprinter delivery vans, though. CDI means "common rail direct injection". The 95-99 diesels used in the E300 are the OM606, which are all still indirect injection technology with a mechanical injection pump. The 98-99 versions simply added a turbocharger. These engines are amazingly efficient and powerful, it makes you wonder what the CDI's will be like when MB finally brings them into the States!
4- I'd be a lot more concerned with the 98-99 W210 chassis than the engine. I've heard a lot of anecdotal quality issues with the W210 (96-02 E-class). Enough to make me seriously think about sticking with the good ol' 124 chassis (86-95) for a long time. If you purchase a W210 of any vintage, I HIGHLY recommend getting a low-miles version and an extended Starmark warranty!But, the diesel OM606 engine appears to be just as robust as all the previous Mercedes diesels (and much better than the crummy 3.5L!)
Best regards,
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