300E cooling and oil consumption.

[dacia]

Gentlemen I have 3 questions regarding my belowed '86 300E. First: since the weather is geting colder I have noticed that my coolant temparutere is down to about 80 degrees or even a bit below at highway speeds. This did not happen in previous years I am wondering if it is the thermostat (I put in a brand new from Benz 3 years ago). The courious thing however is that the car seems to be running hotter in town as well (fans are ok so is the fanclutch and fuses). Go figure, by the way milage is about 260K. Second: Engine never been touched. It is burning oil. Approx. 3 quarts per 3000 miles. Does not smoke not even at startup. Passed emission test 3 months ago. According to my mechanic (only repairs Benzes and Bimmers (I know the heretic :-) ) it is time to replace the valve guides and seals, quoted me about $800.00 US for pulling the head, machining it etc. Said the bottom end namely pistons and rings should not need to be touched 'cause they are very strong. Is he right?
Third: I would like to get the lowdown on the exact procedure on flushing the cooling system. I do have the shopmanual but not much info there. I drained the coolant from the rad but only about 3/4 gallon came out and I even took out the bolt on the top of the engine (probably a bleeding hole?) plus the bolt on the top of the thermostat housing (of course opened up the coolant expansion tank). Coolant was ugly, bit rusty too in colour, it was changed two years ago. So what do I miss here? Is there a bleeding bolt at the bottom of the engine as well? Thanks for your help in advance.

Alex