I guess the selling point of the M120/2.8 is that it is the longest f/2.8 "M" lens, and is presumably at least as good and/or at least as small as the various 135/2.8's out there. My take on that is if the focal length works for you and the price is right, then it's likely to be fine. But for me, based just on specs, it doesn't seem like a lens I'd use much. I too love my M100/2.8 and it's my most used lens - I find the focal length wonderful for lots of things. It can of course be slightly long for portraits, but still usable in a way a 120 might not. And when the 100 not long enough, it's generally *really* not long enough, and a 135 would be better than a 120 - and 150 better than 135. My M135/3.5 gets little use since buying the 100; I suppose I should think about replacing it with the M150/3.5 (the M200/4 is just too big and heavy for me to use much).
In general, lots of good info on various older lenses here (mostly based on experience with 35mm film):
Stan's Pentax Photography
But the 120 doesn't seem to have much said about it not a very common lens, I gather.