I just bought a 2001 E320 a month ago (certified pre-owned so I also have an MB extended warranty). I am therefore interested in your issues.
First of all, you might also post this on the "W210 E Class" forum - just scroll down through the forums until you see it.
Carfax reports are indicative of the condition of a used car, but sometimes don't tell the whole story (I learned this the hard way with an earlier Benz - it turned out to have had front-end damage that did NOT appear on the report). Any service done at authorized MB dealers should be included on that. Joe's Garage - pretty unlikely.
I didn't read the fine print on my warranty - I'm beginning to feel a little uneasy now
Mine came with 2 keys, and 1 of them doesn't always work correctly. The little indicator light lights when I push the control buttons, but sometimes nothing happens. Before doing anything else, I thought I'd replace the batteries (takes 2 2025 watch batteries - WalMart sold me a pair for $5.95 - I think the MB dealers charge at least 2X that).
As far as german engineering, I think that is pretty sound, but I've read that they can't produce reliable micro-processors (most people call these the computer).
Please keep us informed on either of these forums, and Good Luck with your Mercedes!