Not for nothing, but shouldn't you include a lubrication of the speedo cable in your elimination strategy? I had an old caddy a while back that had a surging cruise control along with a surging speedo. Both of these problems were caused by a dried up speedo cable. It seems that the cable was binding within its sleeve and giving erratic speed info to the speedo and the speed sensor.
The fix was to unhook the speedo cable from the back of the speedometer (which is also where the speed sensor is), pull the cable out, lube it with some graphite grease, and push the cable back in. After this quick fix everything was smooth as glass and the cruise worked perfectly. Just a thought.
Sounds to me like this has nothing to do with your problem, but I thought it should be included in your troubleshooting rubric. What do I know, I'm still looking for my first Mercedes! An '89-'91 blk/blk 560 SEL to be more specific.