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I bought a '96 E300D new. I drove it over 70,000 miles with absolutely no problems. It was one of the very first ones that came to the US, but I think the engine was a carryover from the previous couple of years in the 124 chassis. I personally would not hesitate to buy one of these cars again if in good condition and a history of proper maintenance.
After saying no problem at all, I remembered that I had an intermittent surging problem early on. They had not yet seen this problem and it turned out to be some of the intake resonance valves. They now know about the problem and it should be no sweat if it were to show up. This is a minor situation, nothing deep inside the engine.
Good luck,
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