I am installing an XM satellite radio in my 94 E320. There are 3 power leads to the receiver.
1. Yellow for positive (took 12v from the cig lighter).
2. Black for ground.
3. Red, the connection for which is described in the instruction manual as: If this unit is installed in a vehicle that does not have an accessory (ACC) position on the ignition switch, the red lead should be connected to a terminal coupled with the ignition switch "On/Off" operations. Failure to do so will cause the unit to drain battery power if left unattended for an extended period.

Where do I find a terminal "coupled with the ignition switch "On/Off" operations"?

regards,

Mark

Your car has an accessory position on the ignition switch.
Check the vehicle wiring for the original radio and find the wire that gives you 12v +ve only when the ignition is on, that is the one to connect your red wire to.
Make sure to fit a fuse in your constant 12v supply or you risk a fire, normally 7.5 amps but should tell you in the instructions for your radio.

According to my owner's manual, and verified by opperation, the ignition switch has 3 positions
0 - stop
1 - run
2 - start

Thus, I still need help determining what is meant by "...connect the red lead to a terminal coupled with the ignition switch 'On/Off' operations."

regards,
Mark

#1 is your accessory position it has power when the ignition is switched on .