They are correct about the new key being different, it changed in 2000 or 2001, right around there. It is a shorter key, which requires a shorter metal blade. The only other difference is the position of the panic button is out towards the end of the key (the side which goes into the ignition) rather than the other small oval button.
MB will however sell the old style "long" blade for the old style key, but not the old style "long" key itself.
I believe the prices are in line. Well, what I mean is, yeah, that's what they cost.
I doubt there is much you can do, unless there is another dealer you can ask. It is the kind of thing where MB will only sell to the dealers for security reasons, and the dealer will want to make sure you are actually the vehicle owner, so even if there is a dealer several hundred miles away who sells at less mark-up, they still will want you to come in person with the registration for the car and your drivers license before ordering it. (sorry about the run-on sentence
)
Gilly