It seems to me that there are several unanswered questions here.
1. Has the vehicle in question EVER had any body work or after-market work performed in the area where the damage is?
2. Exactly where is the line damaged? If it's a line that runs from the front all the way to the rear, it may be partially inaccessible but that doesn't mean the damage was in this area.( BTW, don't expect any MB dealer to simply replace the damaged section of line using compression or flared fittings. It's a liability issue. )
3. Was it the rubber hose OR the steel line that caused the problem?

In sixteen years I've NEVER seen an MB brake line fail for no reason. My guess is that there's more to the story. From what I've read in this thread so far, there isn't enough information to draw any conclusions. So far it's all pure speculation. Some pictures would be great. If the line in question does in fact run the length of the vehicle, it could be quite a bit of work to replace it. I don't know how roncallo came up with his labor estimate. Before anybody starts trashing the dealer or MB maybe we should get more information.