There might be play in the shift linkage confounding the neutral start switch. With your foot firmly on brake pedal, and the shift lever in N, turn the key to start then move the shift lever slowly toward D then slowly toward 3. See if there’s a point the engine turns over. If so, you probably need a new bushing or two on the rod between the shift lever and the transmission.

Sixto
98 E320s sedan and wagon
02 C320 wagon