It was a fried electromagentic clutch.
The day after my last post, I tested the clutch by directly applying 12V to the clutch supply wires (the two thin wires) and NO click!
By the way, the supply wires going to the clutch were really stiff and some of the insulation had fallen off in places (due to the heat from the short).
So I went out and got myself a new clutch ($60), a new set of supply wires for the clutch ($10 - this connects to the clutch via connector and the other end goes to the sensor/ground; a straightforward replacement) and drove the car to an indie to get the stuff replaced.
30 minutes and the same amount of dollars (labor) later, it was done.
Having seen how it was done, I figure I could have done it myself but i didn't wanna fiddle with the belt.Having seen how the belt is taken off, tensioned, etc I feel more confident if I ever need to replace a water pump or whatever...
Anyway, running temp. is around 82 to 85 deg C and the ambient temp. where I come from is about 30 deg C.In stop-go traffic, the temp is between 85 to 90 deg but never close to 100.
Babybenz 1991 190e 1.8