1997 E300D (210.020), 175K miles - original switchblade style key FOB broke but when taped together remains fully functional.

Recently ordered replacement key from M-B dealer, to find that...

a) the new mechanical key blade is fully functional in the trunk lock.

b) the IR remote activation of the central locking system is also fully functional - the CL system opens and closes on command; red and green lights are functional on the rear view mirror housing.

c) the new blade will not turn past position "0" when inserted in ignition switch,

d) attempting to synchronize the new key (depressing the IR transmitter button twice, with the transmitter window facing the IRCL receiver and then turning the key on the steering lock to position "2" within 30 seconds) cannot be accomplished... the steering lock simply won't budge when using the new key.



The ignition switch turns freely and the engine starts readily with the old key but the ignition switch cannot be turned at all when using the new key, even thought its IR is recognized by the CL system.

No fault codes are present and the vehicle is asymptomatic otherwise.

Impressions? Faulty key from M-B? Hardware fault on vehicle?

Thanks.