I don't own your car, so I'm going out on a limb a little bit, but this sounds more like a $290 job than a $2900 one. This is what I would do:
check the W211 forums for free knowledge on the topic
buy the manual or download it from epc net
plan on replacing the oil cooler or seals myself
flush system, leaving recirc pump alone if it still works

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Prost!