91 300E tranny noise "ratchet" sound in reverse
 

Shifts a little harshly in forward gears as well. Is there an adjustment or do I have bigger problems?

When was the last time you had a service done on your tranny? If you haven't had that done for a while I would take it to a reliable MB shop and have the thing serviced including flushing and then add BG ATC (automatic transmission conditioner). This should take care of most of your problem since it is very possible that the screens in there are caked-up with clutch debris.

Husky898
'93 300CE 156K

The odds are high that you have worn-out reverse clutch plates.
Does the shift from park to reverse take a couple seconds to engage?
Does it make a clicking sound only in reverse when moving?
The reverse plates wear, and allow the metal piston to contact the outer housing. Probably gets a bit better as the tranny warms up, just expanding a bit. If you pull the pan and cut open the filter you may see tell-tell bits of clutch plate lining. Not a bad job to repair, pulling the tranny is the hard part.
If you don't fix it, pieces of metal from the parts rubbing will circulate in your tranny, and soon the clutch plates will totally go, adding to the issue.

DG