Metal In Transmission Pan

1998 S320 BLACK OPAL

My son recently purchased a 1998 S320 from the dealer in southern Illinois with 74K miles. A week later he took the car for maintenance to highly reputable shop in west Nashville - not the dealer. Immediately on the rack they noticed that the the "slip disc" (?) was shot. They replaced that, informing us that the result of not replacing would/could be a ruined transmission.

We thot he was in good shape until the transmission oil pan was removed to reveal discolored transmission oil (brownish) and small metal pieces. We were told that some were from the clutch.

We then took the car back to the dealer to make a complaint who informed us of the following:

1. You shouldn't take the transmission oil pan off until 100,000 miles. They say that MB issued a bulletin to that affect.

2. Metal shavings in the transmission oil pan are normal and nothing to worry about.

3. The car drives fine so there's not problem.

4. Dealer refused to remove transmission oil pan to look at condition, simply saying, it was not necessary and they've never seen a bad S transmission!

We are confused. The shop here says, Well, since they are not going to fix it, drive it until it goes out, but change the filter and remove the shavings so they don't go back up and cause further damage.


Who's right? What could/should be done?
He can still get a warranty for $2500 covering power train but he is leaning against that.

Thanx for any advice.

Dave Shaffer