Follow-up to my original post: I bought a replacement sending unit from a 230E in a wrecking yard. I dismantled it, cleaned the contacts, and marvelled at the clever design which the MB engineers had developed. When installed in the fuel tank, it worked great. On the other hand, the unit I removed from my fuel tank was indeed defective. One of the three wires, the one for the light, had broken, so that it could flip around freely, which explains the flashing lights and the very jumpy gauge. What might have caused the wire to break I cannot imagine. Is there a gremlin in the fuel tank? If so, he or she is a mighty filthy gremlin, since the removed sending unit was very very grungy. I'll be adding biocide to each tank for the next several tankfuls.

Phil