I don't think your electric fans are coming on early enough. My 95 e320 comes on at about 95 degrees C and then cools down to 85 or so.

 

1991 Mercedes Benz 300E (124 Chassis) L6-2960cc 3.0L SOHC (103)

Cooling System: Technical Service Bulletin - High Coolant Temperatures

MD-NET ADMINISTRATIVE MESSAGE DATE: JULY 22, 1994
MESSAGE #: 322
TO: ALL DEALER SERVICE MANAGERS / ALL DEALER PARTS MANAGERS

SUBJECT: GROUP 20 –
ALL MODELS, COOLANT TEMPERATURES The coolant temperature of MB vehicles may rise substantially above 100° C/212° F at high ambient temperatures while the vehicle is:
a) stopped
b) in city traffic ("stop and go")
c) when driving uphill
d) when driving at very high speed, i.e. with high engine load

Engine coolant temperature returns to "normal" upon returning to regular driving conditions. In individual cases, the temperature reading may approach the red field of the temperature gauge. Provided the cooling system is well maintained and in good working order, such temperature levels do not create any danger for the engine and, therefore, give no cause for concern. The boiling point of the recommended coolant mixture (Refer to Service Information 20/9 and Service Microfiche group 20), is much higher than 1OO° C.


Hope this helps

 

The symptoms are indication of under-sized radiator, or wear-out water pump.
Easy way to test it, as well as finding clog in radiator is infra-red thermometer. ($29 at Radio Shack on sale)

 

Just to add prizing note about my VW tdi. I am driving it very hard. The steepest in California Grapevine grade goes at 80 MPH (pedal on the floor for 14 miles).
Than at my project I have 1-mile grade, that require 2-nd gear at 60 MPH (floor again)
Even with the heat wave last month (115F in some areas) the temperature gauge was "glued" to 190F.
Didn't bother to turn AC off.

 

I have seen this happen and it turned out to be a headgasket.

try filling the coolant reservoir to the brim, make the engine not start by either disconnecting the crank sensor or fuel pump and crank the engine. If the water level rises considerably while cranking, I think it would be safe to say it's your headgasket. If it doesn't it still could be a headgasket.