Mark,
The sound you are hearing is (I know this will irk some people) the nature of all Pirelli tires! All the Pirelli tires I have ever driven or been along for the ride have made excessive noise. They handle great (usually) but can be noisy and unforgiving if pushed beyond their limits. When I say a "sticky" tire I mean one that makes the car feel as if the hand of god is pressing the car to the road, a feeling of being able to corner or brake at nearly "track" levels (ever heard the phrase "corners like its on rails"?), of being able to nail the gas coming out of the apex of a turn without getting loose or being eternally on ASR. For non-sticky reference, drive some Conti's. For "Sticky" reference, drive some Michelin MXX3's.

The suspension on the 500E will be firmer than most cars and firmer than most benz. A: because of its sporting nature and ability, B: because it weighs nearly 3800 lbs and to get that much weight to handle as well as it does requires some stiffness. Ride is difficult to quantify, but it shouldn’t be to the point of discomfort. The steering will be "heavier" as well but that is due to the smaller diameter steering wheel and the nature of the suspension/car. Unless something has gone awry in the leveling rear suspension(I REALLY doubt it) I would have to say the tires are the culprit of your woes. It always amazes me how so much of a vehicle's qualities can be lost, wasted, or entirely missed with the wrong tires.

I'm not sure what your priorities are, but for sporty but still silky the Michelin MXM is hard to beat. I have heard that Michelin developed the MXM for the 500E in the first place. I'm not sure of that but I do know it handles well in either OEM 225/55/16 size or (my fav) 235/50/16. You might have a bit of trouble finding the 235's, but they do a great job on the car. If you want a good ride/handling compromise the Dunlop 9000 and Bridgestone S-02 are supposed to be quite good. Both are available in OEM 225/55/16. My personal taste run more towards a dedicated performance tire like the MXX3 in 245/50/16. (Plus-0 fittment) Mercedes (rightfully) considers the tires part of the suspension, so picking the right tire for your needs is just as important as using the right shocks. I'd consider losing the current Pirellis and finding something that suits your needs. TireRack is a good source for tire info. The April 99 issue of Automobile magazine did a test of "sticky" tires. Research around and if you need anything further, you know how to reach me.

Happy Motoring (in a car like the 500E that is rather redundant)...Lee