The BMW 5 series is not in the same class as a Mercedes E class. The 7 series is closer, but still different. I would consider a 735, 750, or 740. The 735 has a timing chain and is a very reliable motor. The 750 is very reliable and amazing motor, but expensive to work on, not much worse than a Mercedes V8. The 750 V12 is also hard to find someone to work on it. Good for the advanced DIY'er. Just avoid the 1993 to 1995 540, 740, or 840 as there are serious problems with cylinder wall erosion. Other than that they are strong runners. The BMW is more "sporty" and less luxurious. That said the 7 series is still very luxurious. My 1980 W126 still rides better than my 1989 735 even though it has more miles and was not nearly as well maintained. But give me a twisty road and the BMW can run circles around the Mercedes. I also prefer the firmer seats of the BMW. Given the same year and level of options I would think the BMW should be quite a bit cheaper than the Mercedes. It is really a matter of choice as they are very different cars. The 5 series is really more competion for Volvos, Audis, and the C class Mercedes. I would say the 7 series is closer, but still more to the sporty side. Both should be long runners and reliable.

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Currently
1991 Mazda Miata 174000
1991 Subaru 189,000 Winter beater

got rid of:
1984 VW Vanagon 195,000
1976 350SE Euro 185,000 KM
1973 280SE 4.5 (boy do I regret that)
1980 280SE European W126 4 speed manual (miss it)
1989 BMW 735iL 119000 (good riddance)