I finaly got home and checked the led. I counted 13 blinks and the MBZ Model 129 Service Manual CD-ROM says 13 = "cam position sensor signal of ignition control module defective". Am I reading this correct and if so, how can I check the ignition control module? I cleared the fault but it would come back on after about a minute of engine idle.

Build led tool and get the codes from pins 3 and 8.

http://members.aol.com/ajdalton7/ledtool.jpg

What is the difference between reading the LED on the car and the home made LED between pin 3 & 8?

The led/sw on the car only gets you to the DM module for existing codes that effect emmissions. The real fault codes are in the Engine Management modules, which can be tapped into with a home-made tool at the other pins.
These codes are system specific and give the Tech a better insight to operating systems faults. The Ignition module is at pin #8, so that is where I would want to find out what has been stored there . By the time that info gets to the DM and Check Engine light, you only know there is a problem coming from the Ignition module, but you don't know what specifically made the module send info to trigger a CE lamp at the DM...so you go to that module and see what that one says.
The only time a CE lamp comes on is when the fault gets to the point of effecting emmissions. The individual modules will pick up the fault way before the CE/lamp DM does. It is the ignition module that has sent the DM info that it has detected a fault in the cam sensor circuit that will effect emmissions. So, the ignition module may have more specific stored code info for you. [ at pin#8...tool will get you into that modules fault bank.]

I think you looked-up the wrong code. Your engine has Continuous Fuel Injection, and I think you need to look at the code chart for that system. There, code 13 is for the air temperature sensor.

I've seen two versions of circuits that use an LED to read codes. The one Arthur posted is the simplest and is essentially what I use (I omit the switch).

I checked the IAT sensor and found it to be open (sensor wire broken). I cleared the code, disconnected the connector from the IAT and got the same 13 blinks on the LED. It looks like that is the problem. Part is on order. I have a little trouble with the MBZ CD-ROM Service Manual. I am an aircraft mechanic and not a MBZ mechanic. It takes me a little longer to figure this out. Thanks for all the help.

http://www.geocities.com/MotorCity/Downs/1039/mercedes/cs1000_mb.pdf

Page 24 ..Code 13 / Intake Air Temp sensor signal Illogical.

I have a 1002 500sl with the same problem but I cant locate the IAT sensor to replace. Please someone help!!!