Yes the insulating blanket is still there.
The car was bought brand new by my dad in 94 (it was custom ordered).
We've owned a saloon E220 as well and also wasn't too quiet but it seemed to have a different (better) engine noise. It had much higher mileage though.

This 220CE has just hit 62,000 miles and is meticulously taken care of.

At lower rpms it's louder than my daily Mazda 3 which has 20,000 miles.
My 08 Audi is whisper quiet in comparison, and the E39 BMW that replaced the W124 in 97 was also whisper quiet in comparison to the 124s we had.

So I am lead to believe they are just a loud engine?

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Smoke Silver 1994 E220 Coupe Automatic
0 kilometers 6 September 1994
100,635 kilometers - 6 September 2010