I don't think there is a setup 2).

No need to get your hands dirty, the bellhousing pickup goes up to a disconnect by the middle of the firewall which then goes to a bundle to a grommet (behind the battery) into the cabin to the EGR controller. If you unplug that disconnect you should measure 1.6 K ohms on the pickup side if the pickup is good and the wiring is intact.

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85 300D turbo pristine w 157k when purchased 167,870 July 2025
83 300 D turbo 297K runs great. SOLD!
83 240D 4 spd manual- parted out then junked