Ken,

All I can say is the switch on shifter goes bad, and it can be fixed(or cleaned). Mine is a little wobbly, but works all the time...

I've not cleaned mine-up because the whole center console must be removed-meaning the radio and climate module need to come out(those use special keys to remove them). Then the plastic valence around the shifter has to be lifted carefully without breaking the locking tabs on the shifter..

Also, at the back of the transmission at the lip of the pan is black round connector with three wires(black, white & green). Push on the connector. Make sure it feels locked in. On the 1996 S320, the transmission is all Hydraulic except for fifth gear. The transmission you have is a 722.508

Best of luck,

Martin