The letter applies to 1998 and 1999 vehicles.
The letter states:
...."we will cover your vehicle up to ten years from the date of first purchase or lease or 150,000 miles (whichever comes first) under the terms of the existing warranty or any extended warranty you have purchased from MBUSA in the unlikely event of any future oil sludging or related engine damage in your vehicle from the earlier use of conventional, approved motor oil (API, SH or SJ). MBUSA will encourage its dealers to mainain their regular policy on loaner vehicles and other customer care benefits during any needed repairs. This coverage applies as long as you maintain your vehicle in accordance with our recommendations, including making the switch to approved pure synthetic motor oil as recommended in the March 23, 2001 letter."
The March 23, 2001 letter advised owners of 1998 & 1999 vehicles to switch to synthetic oils IF they maintained the (extended) FSS intervals. Anyone following a shorter schedule can use conventional oil without problems. However, if you want to benefit from the extended warranty you would be advised to switch to synthetic. The real issue is the long oil change intervals. Some people think an expensive auto should require no service and MB responded. I'm of the old school that loved the extensive preventative maintenance that MB recommended in the past.