M102 8-valve engines seem to let go of the head gasket seal on the rear two cylinders it seems. I reckon many of these engines this age/with this sort of mileage already have early signs of HG failure before the conclusive mayo-in-oil and oily coolant, overheating, bubbling in the header tank etc. Ie, perhaps suffering slightly poor starting/spluttering in the mornings, and a little loss of power rather than exhibiting the usual signs of catastrophic failure - they 'soldier on' for quite a while.
Logic being that they're the furthest away from the coolant pump, and hence if the coolant changes have been neglected the waterways can sludge up and become blocked. This in turn can lead to localised overheating and the HG seal can become damaged as the coolant leaks into the bores. Being at the back of the engine, the rearmost cylinders also suffer from less airflow.
From what I have seen, early detection is quite important, as if left leaking for some time the head (and block) mating surfaces can become corroded, weakened and damaged. Have a look at this for example - a 1993 1.8 M102 head that I actually replaced in the end as I wasn't comfortable with the corrosion in the waterways:
http://www.mbclub.co.uk/forums/engine/82861-lack-coolant-changes.html
Personally, I think that those compression readings are a bit suspect, and I would diagnose a little further. A proper 'leakdown' test as suggested would be a good idea to see if you do have cylinder leakage, and more importantly - where it is going.
*If* it turns out that you're looking for a head overhaul, on the positive side it is a pretty easy job as they go - and most of the parts are cheap/easy to find. A complete gasket set, stem seals, head bolts etc should come in at around £100 - if you can DIY then it's not the end of the world
You can see some pics of the head rebuild I did at the end of this post:
http://www.mbclub.co.uk/forums/members-gallery/86629-1993-190e-le-brilliant-silver.html
After this work, the engine started perfectly, ran like new - with lots of power and great fuel economy
Most satisfying
Will