Wow, that's fantastic work on the finny! Chassis/floorpan swaps are always awesome to see, but well beyond what I can manage to do at this point.
Unfortunately, we don't get the smaller displacement M102s here in the US. Smallest we had was the 2.3 8-valve. One of the biggest issues for me personally is that a lot of MB motors are mated to autos, and finding manual swap parts here is getting difficult, and when sold command a premium. We didn't really get the smaller M111s either, and even with the 2.3 I'm faced with the same problem of transmission options.
The air intake setup on either the M102 or M111 and even the M111K would also need some reworking due to space constraints.
I've already come to terms that a more modern motor, the transmissions are larger, and that means the floor shifter will be further back than the original was. Not optimal from an aesthetic perspective, but it is what it is. I suppose a linkage solution could be engineered to place the shifter in front and above the box, but I have my doubts. It's amazing to me how tiny the 3-speed manual from a Ford flathead V8 is!
Now, a motor from a FWD car, like the 3cyl ecoboost, have tiny manual boxes, but then you're stuck engineering a solution to make it RWD, unless you wanted to go FWD which wouldn't be possible in this car due to width constraints.
Straight-6 motors are far more plentiful, but the W136 chassis was meant for 4-cyl whereas the W153 and the succeeding W187 had a stretched frame for a longer hood to accommodate the extra two cylinders. The extra space in the W187 would also lend itself well to a V6/V8 without the need to worry about cutting the firewall, but alas, that's not what I've got.
Since the introduction of the flathead V8 in 1932, most North American automakers ditched the inline motors in favor of V8s, so most domestic drivetrains from the same era as this car are going to be V8s, with a few straight-6s (but again, length is an issue, so that rules those out). I had taken some measurements of a 260 V8 from a Sunbeam Tiger, and it looked like it could fit with minimal effort, but never was able to pull of a test fit.
If I were still living overseas, I'd have no problems finding a compact motor with a manual, but this is the land of V8s and autos.