Sounds like you're ready for new hydraulic struts and/or accumulators. The symptoms of a failing leveling system are usually hard or bouncy ride (air cells) and sinking over night. Also, you may need a leveling valve as well. The rear leveling system on 16 valve 190Es can be defeated if one opts for it. I don't think it offers a huge benefit over standard Bilstein tube shocks, but some owners prefer originality.
'67 250SE Cabriolet
'93 300E 2.8