OM606 engines are very good engines, BUT, they are engineered for car use,and as Rob says, no good off-road.
So,the question you need to ask is; do you want to use car on-road, or, off-road?
The difference is (largely) the shape of the torque curve. For good off-road (and commercial) use, an engine with a torque peak at low rpm,and a falling torque characteristic is good. As the engine bogs down, the torque rises,which gives a happy situation; an equilibrium can be found.
An engine designed for a passenger car (like the OM60x engines) has the peak torque at higher engine speeds. So, as the engine bogs down, the torque falls - disastrous off-road - you need to grab for a lower gear,just when you don't want to.
If you do want to go off-road, then you would be far better looking at an engine from a Mercedes Sprinter. As the engine will be designed for commercial use, it willhave a torque curve better suited to off-road use.
If you do choose an OM606;
- beware inlet valve recession. The engines are so smooth it's difficult to diagnose. A very slight knock from the affected cylinder (usually 5 or 6, at the back of the engine), and smoke blowing back from the inlet ports if you run the engine with the inlet manifild off
- consider the control of the engine. In the W124, the pump is controlled by a cable,and shut off via vacuum* In the early W210, the pump is a fly by wire,so you'll need to wiring, potentiometer from pedal, and the ECU.
- fit a new set of fuel pipe O rings as a matter of course when you fit the engine. These go brittle and let air in,causing all manner of bad runnig and starting problems.
- Sadly, these engines are favourites amonst those who use comedy fuels obtained from the yard behind the local chippy.
* For the W124 units,you need to apply vacuum to stop the engine - so,a failure of the vacuum system means the engine can't be stopped - so,you need to use the fuel filter which has a tap fitted on top to stop the engine. Don't be tempted to leave that out!