I beg to differ - unfortunately. And buggered if I really know, anyway.

I have been led to believe by the M-B boffins that one should not use any ethanol in a W116. Having said that, I have been known to do so for the reason of shortage of V-Power without any fuel lines disolving on me.
I am also advised by a Jaguar engineer friend that the 'don't use ethanol' argument does not apply if your fuel lines are in good nick and all rubbers have been recenlty replaced. He also advises that if the fuel pump is old the ethanol will strip out the sludge (ethanol is a stronger solvent than is usually found in pertrol) and block the injectors. Thus, his workshop routinely replaces all fule hoses and pumps so that people with older Cats can use ethanol.
In a few years all petrol in NSW will have a minimum of 2% ethanol.
Who knows?
By the way, did it go better on the V Power Racing? My ML certainly does.
Regards,
BenzBoy