There have been many people with questions relating to "limp mode" problems, and none of the causes was due to sludge.
I'd get a second opinion very quickly.
Where do you live?
There are probably members on this site who can recommend a good independent shop.
You may also try the search function under limp mode and see what you get.
You may also search the good shops section and see if there are any recommendations on a shop in your area.
2001 E430, Bourdeaux Red, Oyster interior.
1973 280SE 4.5, 170,000 miles. 568 Signal Red, Black MB Tex. "The Red Baron".