Sounds to me like you have a hydraulic problem. Check the oil level and if that is still OK, you might have problems with a leaking hose or hydraulic valve. I had a problem with one of the valves/solenoids as well and brought it to the dealer to have it repaired since I figured that it would take too long for me to find what was wrong (this was about 1,5 year ago and I didn't know a thing about the R129 back then).
The beeping sound and flickering switch means that the top is not closed. You probably have to use the top-emergency-tool to close the top manual (locking the second part of the lock, since the top managed to lock the top partly).

The hydraulic system of the top and roll bar is very complex; the rear part of the car is filled with hydraulic lines, valves, switches, solenoids and such. It is not something I would just start trying to repair...

greetingz,

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1990 300SL-24
1993 C250D with a minor 600+k kilometer
www.MBenzNL.com(the Netherlands)