Being an ASE master tech, (not bragging) I say "D". It sounds to me liek the turbocharger is malfunctioning. Thus causing the engine to run excessivley rich, producing the black smoke and lack of power. A turbocharger is very impoertant on a diesal that is equipped with one. It what is responsible for creating the very high combustion pressures that make a diesel a diesel. With the abnormally low compression, it runs very rich. Ever notice when a semi takes off from a start, that it pukes black smoke for a second or two? Thats because the turbo ahsn't spooled up yet, but when it does, the engine prouces the correct air/fuel ratio and runs at proper stoichometric efficiency. (for a diesel any way)