Okay -- I don't know anything for certain about this but I
kinda understand how this stuff works and if I'm wrong hopefully
someone will correct me. Otherwise since nobody else has responded
I'll take a whack...

The coil is just a step-up transformer. The different color
bosch coils have different ratios and so multiply the input
voltage by that ratio.

The purpose of this is to make an impressive spark that blows
up the stuff in your combustion chamber...

I believe that the ignition in these cars is actually farely
thoughtfully engineered to produce a reasonable compromise between
good spark and long points life. The 164, for instance, runs its
ignition system at 9 volts most of the time but 12 when the key
is in the start position; volvo did this because running the
ignition at 12 volts (times whatever ratio the stock coil uses
to produce 12,000 or so volts) would wear the points out too
quickly.

If you put in some different coil that runs the high voltage
side of things at 30,000 or 40,000 (wild, yanked out of my ass
numbers that are almost certainly not correct) you may well wind
up changing your points every 800 miles.

Even if you install some crazy super-duper high voltage ignition
system (some aftermarket systems run the low voltage side at 400
volts and step that up by the standard ratio resulting in insanely
high voltages on the high voltage side of things) you won't see
any advantage unless you run different spark plugs that have a
larger gap in them. You can bend the ground electrode out a little
but at a certain point you can't bend it enough to widen the gap
because the electrodes won't be parallel to each other. Also,
once you go to a gap past 40 whatever the units are you will
start to wear out the plug wires and distributor cap quickly as
well.

In short, I would stick with a coil that has a step up ratio that
is pretty similar to the original. I don't think bumping the
ratio somewhat would throw things out of wack too much, but this
brings us to the original problem.

My understanding is that the stock bosch coil has a step up
ratio of 100:1 (input voltage of 12 volts yields a high voltage
of 12000 volts). The blue coils have a ratio of 150:1 and the
red coils have a ratio of 200:1. The problem is that new blue
coils are not very well made and so the choice is OEM or red
where red may wear out the ignition system (points) too quickly.

Were I in your situation, I would go to a junk yard and buy a
used coil from a low milage 70s mercedes. They come with blue
coils stock and these are likely german made high quality blue
coils not flakey poor quality modern blue coils.
chris


references:
http://www.mbzponton.org/valueadded/maintenance/ignition/coil.htm
http://www.vintagesaab.com/sonett/ss/HiPoCoil/HiPoCoil.htm