This car has a 5 speed automatic transmission (190,000 KM).

When I put the shift into the reversed gear, it will not engage unless I rev. up the engine (i.e. it will not engage in reverse while idling). I brought it to a MB dealer for inspection and was advised that the transmission needs to be replaced.

Questions:
Is this common for this chassis/power-train? I hears MB transmissions were virtually undestructable if they are propoerly serviced (which this car was).
Should I replace it with a new, used, or rebuild? What are the cost differences?
Is replacing a transmission a complicate job and should it be performed by the dealer or can it be entrusted to an independent MB tech?
Does anyone know about the reliabilty of this engine? In other words, is it worthwhile to invest in the replacement of the transmission when the car already has 190,000 km.? I had recently tested the engine for Ontario's mandatory emissions testing. The results and the compresssion were very good.

Your comments will be appreciated.

Reverse gear is applied by large piston mounted in front cover of the front pump assembly. The reverse clutch discs are more than likely not worn out. But there are 2 rubber seals that allow the piston to apply. These seals may be bad.