M119 engine is the best. Of course I'm a little biased.
First off, the transmission is an overdrive transmission 5 sp with a 2.82 rear axle ratio (vs 2.27 for the 400E). This means the acceleration is better than the previous 4.2 M119.
The '97 E420 had an optional ESP stability control device that helps you to avoid accidents(I've got that on mine).
Yes there IS a sport package for the E420. I don't know exactly what else it includes, but I know it comes with 18" AMG monoblock wheels.
The 500E is a very rare car. You'd be lucky to find a good example. Don't compare a 500E with an Infiniti, because that's like comparing apples to oranges.
The valuation over time for one of those new Infiniti's over 10 years will drop near zero. They are very weak in used car pricing.
And, there is no comparison, of any car out on the road, to the combination of the ride feel, safety, and handling these cars provide. Really!