Which is easier?
 

Replacing just the rear control arm bushing or replacing the entire control arm on a 1987 300E?

Yes, definitely

I'm glad I asked.

Just do the bushing. You will need to compress the spring though either way to be anywhere near safe doing it. Just unbolt the single that goes through the middle, drop it down, replace the bushing and put back in place.

Maybe take the opportunity to put in sportline bushings? :)

Let's see if you just replace bushings you ...

1. remove arm
2. press out old bushing
3. press in new bushing
4. reinstall arm

if you replace arm ...

1. remove arm
2. reinstall new arm

See the numbers of steps?

And you need a special tool or must make one to press the bushing in/out.

It looks like 1 & 1/2 inch pipe might fit. I was able to slide the new bushing I have through that pipe with just a little bit of clearance.
Anybody?
Also, I have a stripped lug hole on the rear right hub.
Any suggestions on fixing that? New, junkyard piece? What would be needed?

Yeh...new hubs are over $150. I would junkyard it for $10. Since they are all the same, you may find a model with everything already removed.