With the lower seats flipped up or removed you just have to grab on the seat backs and give them a yank. If they're stiff sometimes you have to yank back and forth a few times to get them to release. If they still don't want to release there is a little lever deal that the seat bottoms sit on at the bottom of the seat backs, that's the release... wiggling that lever while pulling on the seat back may get it to release. Once you use them a few times they will probably free up quite a bit, they get stiff from not being used.

Several different things can cause the locks not to work. Have you tried the key in all the doors and hatch?

Does the 4-matic light stay on? Check to see if the hydraulic fluid reservoir behind the driver's side headlight has fluid.

Most people don't realize it but the 124 chassis 4-Matic wagons are one of the best handling cars MB built during those years. You'll find that the more you push the car the more grip it has, that is if you can keep the 4-matic functional.

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90 300TE 4-M
Turbo 103, T3/T04E 50 trim
T04B cover .60 AR
Stage 3 turbine .63 AR
A2W I/C, 40 LB/HR
MS2E, 60-2 Direct Coil Control
3" Exh, AEM W/B O2
Underdrive Alt. and P/S Pulleys,
Vented Rear Discs, .034 Booster.
3.07 diffs 1st Gear Start

90 300CE 104.980
Milled & ported head, 10.3:1 compression
197° intake cam w/20° advancer
Tuned CIS ECU
4° ignition advance
PCS TCM2000, built 722.6
600W networked suction fan
Sportline sway bars
V8 rear subframe, Quaife ATB 3.06 diff