Joe:

Your Hobie Cat 16 and trailer won't strain your diesel, although you'll know it's back there...

I have an after-market hitch on one of my 300Ds. It bolts to the bumper and to the spare tire well. I wouldn't try towing much over 1500 lbs, mainly because of the hitch mounting. As far as the engine/transmission, I don't think it's a problem.

my $.02,

Wes