According to documentation I have, there are several possibilities listed under:

"Motor does not start. red/green lamps blink alternately with ignition on"

Possibilities are:
1. Vehicle is Locked (incorrect use)
2. Vehicle will not unlock
3. Engine Control Module did not authorize DAS (Driver Authorization System)
4. CAN wiring harness defect
5. Engine control module has not learned the identification code
6. Defect in engine control module

Troubleshooting described in literature is pretty straightforward, but you need a Mercedes HHT to track the flow chart. Not sure why the dealer is waving you off on this... there's a troubleshooting section devoted to this and there are only about 6 steps.

Seeing as how the problem only occurs when its cold, there's an intermittent somewhere... I'd start by doing the simple stuff... unplug and reconnect all the connectors in the system... you may simply have an oxidized socket connection somewhere.

If that doesn't work, you'll need to find a dealer/tech that will take the time to look it up and do the procedure while the system is in the "failed" mode... which I suspect will mean hooking up the HHT in a cold parking lot ...

Hope this helps.

__________________
KenP

1996 S500 W140 Coupe