Some greyish smoke after a cold start is normal. I've seen many MB diesels and I have yet to see one that doesn't smoke after a cold start. However, a good running diesel should barely smoke at idle or while cruising once it warms up, but again some black smoke during acceleration is normal. In my case valve adjustment greatly reduced smoke during high loads, such as going uphill on the freeway.

__________________
2004 VW Jetta TDI (manual)

Past MB's: '96 E300D, '83 240D, '82 300D, '87 300D, '87 420SEL