Yep, that process will work for the W124 TE's. My only additions:

If you have a vaccuum-pump/turkey baster, I would suck out all the old fluid from the resevoir. If the resevoir is dirty, remove it and clean it out with brake cleaner, and let it dry completely.

Then install a NEW filter and fill-her up for a flush. Should take about 1-1.5 liters to flush.

:-) neil
1988 360TE AMG
1993 500E