phatryd, thanks for your reply. I'll check to see if AC is coming out the windshield defroster vents during normal operation. I suspect it is, which is causing moisture to condense on the colder part of the windshield directly above the defroster vents. The sad thing is the car exhibit this behavior for the past 3 years while under warranty and I never thought much about it until now.
Any other W210 owners out there with a similar problem?
2000 Lexus RX300