Mark, hi.
Did you ever figure this out? Did a search and found your original post.
My '96 S500 has started doing a similar thing... when first starting out in the morning, the heat comes out the defroster vents and some out of the end vents in the dash. Nothing out of the floor vents no matter what position you select.
Shut the car off for 10 minutes.... restart it, and everything works normally...
If you figured this out, would appreciate knowing what the problem was.
KenP