What about the MD81? It's less fuel efficient, but has higher capacity and it comes out earlier. So I think it should be used to replace DC 9s and 727s which were bought very close to the release date when the 737-300 isn't out yet. What do you think?
The first option to replace a B727-100 is the DC-9-50 in low density of seat, but MD-81 is a good option but not for large time. I recomendate use MD-81 for maximun 10 years and replace that plane for A320 or B737-300/-400
If you want to wait a little more, replace directly B727-100 for B737-300. That plane have the same capacity of passengers of B727-100.