Dave, I have used this block test kit:

http://www.amazon.com/UVIEW-560000-Combustion-Leak-Tester/dp/B000NPDL76/ref=sr_1_11?ie=UTF8&qid=1297583029&sr=8-11

I successfully diagnosed a small head gasket leak in a forum members SDL.

I also used it to rule out problems on my 85.

It works well - easy to use and it's super sensitive.

dd

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'85 300D, 'Lance',250k, ... winter beater (100k on franken-Frybrid 3 Valve Kit)
'82 300D, 'Tex', 228k body / 170k engine ... summer car
'83 300TD Cali Wagon 210k, wife's car