I drive a fairly new Mercedes C class sports coupe (2005 model; 7k miles), and couldn't be happier.
I find that Mercedes produces the most solidly-built cars in the world in terms of quality. Everything in a Mercedes is solid and just works. If I don't start my Mercedes for 6 months and just have it sit in the garage I can come back and it will start as if I had driven it yesterday.
Every tiny detail in the car -- exterior, interior, engine -- is just so well built and has excellent quality. Mercedes doesn't cut corners when building cars. A good friend has the S65 AMG, and that's probably the most solid car I have ever driven. Every Mercedes you will ever sit in -- from the lowest priced to the most high end -- is just a testament to superior quality and craftsmanship, and that's why I vote for Mercedes.
Regarding BMWs, I find them too arrogant, too show-off ("small penis car"?, though not as much as a Porsche). I personally like understated elegance, and there isn't much understatement or elegance about a BMW, especially those little 3-series coupes everyone and anyone seems to have these days.
I do like the BMW 6-series. Fast and sporty, but still smooth, elegant, and understated. However, my ex-bf had a 6-series, and the car was in the shop more than out on the road. He got so tired of the car constantly breaking down that he sold it after 3 months, even though it was a luxurious, fun-to-drive car when it did run.
I have seen the prototypes of the next generation Mercedes, though, and am concerned about their styling looking forward. I've seen the new CL, CLK, and C class, and to me they all look terrible, though, so I'm a bit worried as to what I'll buy next -- would love to stay with Mercedes, but can't seem to find a future model I find visually pleasing.