Changing tire size

Currently have 17" low profile wheels/tires on a 2004 E500 MB wagon. For a more comfortable ride, as well as to have more protection against curb damage, I would like to switch to 16" wheels/tires as on the E320 wagon. Anyone know of any problem? (I do not have tire pressure monitor option)

Go to tirerack.com and see what fits with regards to wheels. A limiting factor typically is larger brakes that cannot clear so nothing less than stock size is possible.

I have this same issue with our Subaru Legacy turbo wagon.

Sounds like a good idea to me, assuming you make the correct aspect ratio adjustment and the brake rotor clearance is OK. As long as you have those things covered, there should be no problems.