dkveuro-
On your question whether or not the schematic is correct...
I went and checked the MB schematic for my 1996 S500 in my ALLDATA account... its drawn differently, but the coolant circuit is identical electrically to that depicted in the Mitchell's schematic on the .ru site.
Simple circuit for the coolant level sensor... ALLDATA account shows a drawing of the floating ring/sensor in the tank... it operates as you think. Simple switch; on/off.
No connection between coolant level circuit and anything else.
Something obviously doesn't square with what you're finding...

Hope this helps.

__________________
KenP

1996 S500 W140 Coupe