We also have a '97 E320 and am not having any problems. These cars are touchy on alignment. I had the dealer align it twice and could not get it right, so I have gone to an independent alignment shop and they got it correct. My suggestion would be to change shops.
There is some discussion on cross rotating tires. I have had poor results by doing so and will only do it to correcttire pulling as you have described. With radials running true, I do strictly front to back.
My classic has bias ply tires and there is something to really gripe about. We forget what lousy handling truly is. Ed