My husband owns a 2000 S500 (he's a mechanic) and when he first got it he had the same problem with the left front. He took it to the dealer for a diagnostic and $125.00 later with a quote for $9,600.00 to fix the problem, we were told that the strut needed replacing.
We bought the star scan tool and to our surprise it was the left front height/level sensor. $240.00 and the problem was fixed. Our regular tool could not scan it but at least we can perform diagnotics on all benz now.