I have owned a '91 4matic for 5 years and understand your frustration, however I don't think you want to seriously consider removing the 4matic system. It is deeply integrated into the car and removal would be my last choice. Retiring it in place is an option, just put the selector valve under the hood to bypass, but it depends on where your leaks are. Most of the time the transfer case is the culprit for high estimates. In the US, removal and replacement of the transfer case is about $2300.
If you are still considering removal of the system, consider the following:
- the tandem pump supplies hydraulic pressure to the hydropneumatic suspension and the 4matic system from the same sump and pump. The other pump on the tandem is for power steering. So you would have to blank off the 4matic system with threaded plugs to leave the suspension system functioning.
- also, the 4matic system receives input from the ABS system, the steering wheel position indicator, and engine management system. Disconnect these inputs and you might be creating more problems than you started with.
- also, the front axleshafts come out through the engine oil pan and front diff oil pan. If you really want to remove the system, what are you going to do with the openings?
If you really can't live with the car, I'd recommend finding another model without the system. It's similar to the question of how can I make my 300E as fast as a 400E. The easiest and cheapest answer is usually to change cars. Especially on a 10 year old model that can be replaced for about $10k (US).