The rpm versus road speed sounds about right to me. These cars always revved quite fast in 4th gear.
The 260E is a nice car. Watch for rust (unless you are in some warm, dry part of the world, unlike me in rainy old UK!). Beware of head gasket problems. My 260E never had any problems here but they can occur. Oil leaks are common from many places, don't worry about them too much, unless you have coolant loss as well as this probably indicates a failed or failing head gasket. The valve stem oil seals usually fail on this engine as they go brittle. This will allow oil to leak into the combustion chambers giving a smoky exhaust (eventually) and showing up as increased oil consumption. It's possible to replace the seals in situ quite easily, and it isn't too expensive.
Other things that wear are differential mounts, engine mounts and (at high mileage) subframe mounts. Rubber bushes in the rear suspension can wear as well leading to odd and exciting handling! My car also experienced a failed fan and this showed up as overheating in heavy traffic. Not to bad to replace.
Watch out for fuel injectors failing, or leaking so you get a blubber when the car has been left for a while hot and then restarted. The fuel accumulator can also cause this when it fails.
The camshaft can also fail if oil changes have not been done as they should, and this can lead to a noisy engine. It's quite common to have a light tapping on start up from the hydraulic tappets (valve lifters) not pumping up properly, but this goes after a short while and may get better if you use synthetic oil. A rather harsher knocking or clattering noise may be caused by a worn timing chain or tensioner but this is unlikely on a car of your age that has been well cared for. The chain can be replaced in situ again.
Enjoy your 260E!
-- Al Bolton, G4VSQ
1990 Mercedes 500SE 132,000 miles
1988 Mercedes 260E 159, 000 miles
I bought a 1987 260E about a year ago, it's a great car in great and
> in great shape. A one owner vehical with on 69,000 original miles on
> it, meticulously cared for. Anyway since it is an older vehical I am
> fully expecting that parts are starting to wear out on it. Does
> anyone know the reliablilty of the trasmission of this model
> (auto-matic) or where I might find that information? Also I was
> curious about the gearing of MB's in general. On my car the engine
> seems to run at pretty high RPM when in 4th gear, around 3500 RPM at
> 75-80 MPH. Is that typical of my model and/or MB of this era in
> general. At first I thought that maybe the Transmission was bad but I
> did drive in 3rd and shifted up to fourth and the trasmission shifted
> properly. So I was curious if this was just how they were geared. It
> never seems to run hard, in fact, it's pretty much smooth sailing down
> the highway as I have quite a commute on the open road.
>
> Thanks in advance for any input.
>
> Miles