While I don't have a C36, I do have the engine from a C36 in a W124 wagon (http://www.silcom.com/~neilv/sportline).

Also, I don't have a E420, but I do have a 500E.
Hence, my comparison will be on the engine/powertrain.

The C36 is FUN, but you have to rev it high to extract the fun.

The M119 V8 has so much low-end torque, and it's so smooth. Hence, it is very relaxed to get FUN/performance out of it.

The C36 will out handle the E420, even if you do a Euro SportLine suspension upgrade.

For an everyday driver I would get the E420, put in a 2.82 or 3.06 differential (more fun!) and Euro Sportline suspension.

However, if you need something smaller (city parking), want to have some fun in the "twisties" or mountain roads, and don't mind revving it, get the C36. The C36 will feel also lighter than a W124, which perceptively, is less safe.

If you can, get a 1997 with the 5-speed.

Better yet, find a C43. V8 in a C-class: smooth & relaxed powertrain, with the C36 suspension . . .

:-) neil
1988 360TE AMG
1993 500E