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Excess oil consumption and low compresion are usually a result of stuck or gummy piston rings on these things.
Try giving it a couple of treatments with Auto RX ( www.auto-rx.com ) that stuff does wonders for cleaning up stuck rings anf bringing compression back. Look around on their website for the instructions for diesels to make sure that you do it properly. The stuff is costy, but it's worth every penny. I have no connection with that company aside from how good they make me look everytime I fix up one of my customers cars with the stuff without having to do any expensive teardowns.
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-------Robert, '93 940t, '90 240 wagon, '84 240 diesel (she's sick) , '80 245 diesel, '82 Mercedes 300SD
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