I thought I was alone. My C 240 has the same problem. I leave for work at about 5:00am every morning, and during these cold winter months, my windshield, side wondows and rear glass all fogged up. I have tried all settings, and found that:
1. the defroster setting work best,
2. the "Auto" setting is also good, but the defroster setting is more effective.
But I try to use them least as possible, because at either settings, they are very noisy. Also, they would leave no warm air coming down for my feet, leaving my feet freezing cold.
In conclusion, I found that the climate air circulation system used in the new C-Class is very weak.