FWIW I had this problem on a 420SEL. Part of the smell came from small right side trans leaks hitting the exhaust. Some of it came from a squashed area of the rubber seal that runs across the top of the firewall. The blower intake is right behind that seal, and it is possible for engine smell to get pulled in by the blower if the seal is worn.

I would check the two breather hoses - one of the left front, the other at the right rear. And it takes only the most miniscule valve cover leak to cause and oil smell.

__________________
Chuck Taylor
Falls Church VA
'66 200, '66 230SL, '96 SL500. Sold: '81 380SL, '86 300E, '72 250C, '95 C220, 3 '84 280SL's '90 420SEL, '72 280SE, '73 280C, '78 280SE, '70 280SL, '77 450SL, '85 380SL, '87 560SL, '85 380SL, '72 350SL, '96 S500 Coupe