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I like the better handling chassis of the W124 vs. the W126. The semi-trailing arm suspension of the W126 just does not give as sporting a feel as the W124's five link.
That said, the W126 is roomier and in many ways a better highway cruiser. The 300SE is my favourite W126 for it's bulletproof M103 engine and nimbler chassis than the SEL cars.
In the case of your choices, I would prefer the 1995 E320 because of it's more updated looks, newer model year, and better performance. That's not to say the 300SE is a dog, but in MY OPINION the last of the W124's when sorted out (head gasket and wiring harness woes repaired) is one huckuva fine automobile.
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