I'm the proud (so far) owner of this exact model. I also purchased mine used
last March with 34,000 miles. I now have just over 43,000 on it. I also
heard after I purchased it that it is Mercedes most problematic model. Not
what I wanted to hear after buying. Mine was and still is under MB new car
warranty until the end of this year. That's small consolation for the coming
years I intend to keep it. It's a great car with a terrific ride, great
handling for a sedan and plenty of power. I am not at all sorry I bought the
car. I love it. I have since purchased a so-called "bumper to bumper"
extended warranty for 7 years or 100,000 miles for about $2500. I sleep a
little easier now.
I have had a few electronic gremlins since buying. I've twice experienced an
alphabet soup of failure warnings on the computer display. It said I had
failures or faults in my ABS, EBC, ESP and maybe one or two other letter
combinations I can't remember. None of them were a reason to stop the car.
The malfunction codes reset after turning off the car and restarting. The
message said to bring car to dealer for inspection. I've also had some
problems with the Logic 7 Harmon-Kardon sound system. The electronics (like
a computer) would not boot up two different times. Also, once I had a static
that would rise until it drowned out all other sound. All of my electronic
problems were corrected. A failed driver seat headrest motor and a new
console armrest due to a bubble in the leather were replaced under warranty
by my local dealer. All of the electronics were repaired with updated and
"reflashed" software programs. I had only a good experience with my dealer
so far. I'm not aware of any engine reliability problems and I did new new
brakes soon after purchasing. The rotors were a little scored so I went
ahead and replaced all rotors (MB says you don't cut them) and opted for
Greenstuff brake pads which have almost no brake dust dirtying up my new 19"
chrome wheels. The stock pads were pouring out brake dust. I have to put up
with a little squealing, but shiny wheels!
As for spotting a good one you may want to have the VIN checked on any
prospective vehicle. Your dealer can do this and give you a complete history
of maintenance and repairs. The vehicle condition and the history should
give you an idea of the car and also get a Carfax to check as much as
possible.
Good luck to you, and me too!
Howard
...> I'm tempted to buy a Mercedes E500 - secondhand, probably a 2003 model.

A relatively low mileage recent model won't have much wrong with its
mechanicals - unless it's been in a crash, then all bets are off. But
the electronics cause owners' unhappiness. And nobody can look at one
car and know whether IT will or will not have problems. A fleet yes but
not a single sample.

In the USA M-B dealers (only) sell recent vintage cars with a Certified
Pre Owned warranty - 12 months to 100K miles. Such CPO cars are also
eligible for a purchased M-B Extended Limited Warranty at additional
cost - about $2,000 for one year and $2,500 for two years following the
CPO.

Gamblers can buy used M-Bs quite cheap and take a chance on their repair
cost, others choose to stay within the system, pay extra and know the
inevitable repairs will be covered by M-B.

Repair cost apprehension isn't part of owning a luxury product, IMHO.