Joel,You should go to the soon-to-be-organized Northern California event and drive some other W113's (owners permitting).
http://index.php?topic=2957If you have the time & money, fly to Ohio and drive some cars here.
http://index.php?topic=2120I would say your RPM drop between gears is normal. With only 4 speeds, they cannot be close ratio.
TheEngineer,
I agree with Cees that you have a problem with your transmission. People say "These old cars just shift rough.", but that's mostly because they are old and something is worn out, not because they were engineered to shift rough. I don't have any educated suggestions for you, the only things I've heard of people doing for transmission problems is adjusting the venturi flap properly and replacing a rubber part that works with vacuum/pressure modulation. Keep this thread active and someone good with automatic transmissions will help you out.
RoddPowell, Ohio, USA
1966 230SL, Euro, Auto, Leather, both tops
1994 E420