Sure sounds like shifter bushings to me. Very likely the ones under the car. My SDL was like this, VERY sloppy shifter, you had to sort of guess where it was. The bushings are plastic (some sort of nylon) and when they age they crystalize and break off.

__________________
Current stable:
1995 E320 157K (Nancy)
1983 500SL 125K (SLoL)

Gone but not forgotten:
1986 300SDL (RIP)
1991 350SD
1991 560SEL
1990 560SEL
1986 500SEL Euro (Rusted to nothing at 47K!)

Gone and wanting to forget:
1985 524TD 167K (TotalDumpster™) [Definitely NOT a Benz]