mine was blinking in and out, seemingly with changes in temp/humdity. i changed the thermistor last month and it didn't seem to change things then suddenly, last week it just started working properly. if you want to check the sensor, disconnect the cable at the junction by the fuse box. i found mine underneath the fuses (you have to open up the fuse box). it's one of those two-wire clips with a green and a brown wire. connect a 3k ohm resistor across the terminals and you should get a reading on the lcd.
1993 300e-2.8 - gone now <sigh>
"Do not adjust your mind, it's reality that's malfunctioning"