Happened to me...
The service manager asked me if I could turn the key at all.
"Nope, the key nor the wheel will turn. "
Got some bad news for you. It's a five hour job to remove & replace.
If your dealer will do it for 800.00 that's less than I paid.

The way I understand it is if the key can turn, the cylinder can be removed. If it won't, it has to be drilled out. It is a common failure on the 124. Mine had about 132,000 when that happened.

Here's another thread on this topic.

http://www.peachparts.com/shopforum/2949730-post5.html

Good luck.