To be more specific:

VIN prefix WDBEA28... is a 124.028 with the 2.8L M104 motor.
VIN prefix WDBEA32... is a 124.032 with the 3.2L M104 motor.



And no, the VIN digits do NOT always indicate displacement, that was a nice coinkydink on the inline-6, gas-engined 124 sedans. The 4.2L and 5.0L V8's are .034 and .036 respectively, the 3.0L turbo diesel is .133 (non-turbo is .131), the 2.5L diesel is .128, etc - as you can see things don't always match up so nicely.

More useless info: for the W124.xyz format,the "x" indicates fuel type and 2wd/4wd:
.0yz = gas 2wd
.1yz = diesel 2wd
.2yz = gas 4Matic
.3yz = diesel 4Matic

and, the "y" approximately indicates chassis type:
.x2z = sedan (wimpy engine)
.x3z = sedan (non-wimpy engine)
.x5z = coupe
.x6z = cabrio
.x9z = wagon

the "z" is pretty convoluted, I won't even attempt to go there, I'm not sure there even are guidelines for what this digit will always indicate.