I had a couple W123s from 2000 to 2006, a coupe and a wagon, and drove them on a 90-mile commute whenever there wasn't snow on the ground. I bought one for $2K and the other for $2500.
After diesel prices went through the roof just before the Great Recession, people added rigs to burn french fry grease and killed a lot of these fine cars before their time. Now they're "collectors" and fetch premium prices.
As far as handling goes, I always preferred the W114 and W115 chassis to the W123. I might get back into old-time diesels if I ever ran across a nice '75 or '76 300D.