I am currently into another project putting an OM617 turbodiesel into a 1967 landrover 109. It's a MUCH bigger engine than the 4D55T (I happen to have one of each sitting on the floor of the shop). Much heavier, and larger. I'm not sure it would be very easy to fit in the D50 engine compartment without some modification.... It's got a great reputation as a really good engine, as long as you don't run it out of oil (duh). I have the older non turbo mercedes engine in a mercedes car as well, and it's hard to start in the cold (series glow plugs instead of parallel like the newer ones), but runs pretty nice otherwise. There's also the issue of the transmission -- the OM617 only came with an automatic in the US, though you can get the 4 speed manual that came on the 4 cylinder mercedes. I got an adaptor plate to bolt mine to a 4 speed 3/4 ton (SM465) chevy truck transmission for the landrover project, though you can also get them for toyota truck trannies.

If I ever upgrade the engine on my D50, I'll probably go for the 4D56T option (or the 2.8 liter... can't remember what designation that is). I see used JDM ones on ebay quite often for the 4D56T.