Oil sensor?
 

There's some type of sensor on the passenger side of the engine, above the oil pan. It's leaking oil, which drips onto the exhaust pipes.

My dad and I tried to take it off and replace the o-ring, but we couldn't figure out how to take it out. We tried to gently pull it out, but it felt like it was connected to something on the inside. :confused:

This is on a 1991 420SEL.

It is the low oil level sensor.

Easiest to click on Buy Parts above, and look at a picture/drawing of the part. There is a chamber on the inside.

I seem to recall a couple of bolts on that unit, if it's the same style as on my 300SE. I think 10mm. Could be wrong.

Anyway, replace the O-ring that seals the unit to the oil pan, and there's also another o-ring that goes on the stem where the plug attaches.

I took the opportunity to clean out the unit so that the float operates freely.

Got the Drip?
 

Friend,
To reseal the level sensor connection, you will need to R&R the sheet metel pan on that V8. I agree that a new o-ring wiil reseal the connector if it survived the tug job.