W210 E320 Station Wagon 4matic ?????
 

I am looking at a I believe 99' year model E320 4matic Sedan. The car has some sort of transmission issue. When you shift the car from park into reverse or drive, it sounds like the transmission is chewing ROCKS! Very loud and violent. The car won't pull itself out of its tracks either forward or backward. My question is what happens to a car, or how would you know, if the transfer case goes out on one of these 4 matics? I have read quite a bit on these cars and it seems like alot of them have had transfer cases replaced and I was just wondering why?

It sounds like a transmission problem rather than a transfer case issue. The first 4Matic system used in the W124s was notoriously complicated and problematic. The later system in the W210 is much simpler and much more reliable. How many miles on the car? Unless the asking price is very low and the car is in otherwise good condition, I would avoid this car.

Mercedes itself sells rebuilt transmissions.

Probably the transmission. As noted previously, the problematic 4matic system was on the earlier 124 chassis cars, through 1995 model year. (It may have been discontinued a year or two earlier, not sure...) The newer 4matic that debuted with the 210 seems quite reliable.

Even in decent condition, a '99 is worth what, perhaps $6K? Putting in a factory rebuilt transmission (the best, with a good warranty) is maybe a $4K repair. Given that you can't test drive it to tell what else is wrong, the car is worth zero dollars. Not sure I'd take it even for free. Even after replacing the trans to get it on the road, you might find enough other issues that a different, running car at a higher price would be a better value. Walk away.