Well, if it wasn't for bad luck.....
My 560SEL was manufactured in 10/88, and this means I have the single hole for the lock release. I turned the key to #1 position, inserted my trusty paper clip, felt something move, and tried to turn the outside housing of the lock. Not moving!
Does anyone know if this turns as it is, or do I somehow remove the black piece with the little marks that tell you the position of the key? Should the key turn with it, or stay still? I attempted to grab at the outer part of it with needle nose pliers, and no go. Is it some left hand thread or other creative feature in there?
Any help is appreciated! Thanks for the advice so far Jim, Larry and Benzmac!