Hi James,
I've driven parts of what you're considering: What was a new C270 CDI with the 5G-tronic automatic gearbox, and a new E320 CDI with the 7G-tronic automatic gearbox.
The 5 cylinder 270 CDI engine is a real honey, producing around 180 bhp and 400+ NM torque - exact figures depend on the model and year.
Great fuel economy for this class of engine and Euro III emission compliant, and does indeed run better (more power) on a premium diesel fuel.
The E-class is significantly heavier than the C-class, but performance is still adequate, and it's nice and roomy inside.
What to look out for:
1. Full MB service history - aside from the peace of mind that the previous owners did it right, then you still have 25 years of the free pan-European roadside assistance to hand.
2. Self levelling suspension on the E-class estate - nice.
3. If the E-class has been used for towing - and covered 100,000 km - get the suspension bushes checked and possibly replaced
4. The fluid in the automatic gearbox - have that changed if the car ticks the box for previous towing history
5. Rear tyre wear - I get about 15,000 miles from a set of rear tyres - does depend on how you drive, but sub-10 seconds 0-60 towing our caravan is OK performance.
6. MB factory tow-bar - part of the factory kit is a 50% upgrade to the engine cooling fan. This nice to have extra cooling to caress the engine will be missing from any after-market tow-bar...
7. Avoid "Classic" models - they are a bit thin on toys - but it's unlikely you'll find too many E270 in Classic trim.
An E270 Avantgarde with four zone air-conditioning and a few other toys above the standard specification makes a pretty good car... And with rear wheel drive, they tow well too.
Robert (a confirmed MB nut)