I was talking to my indy and he was telling me how theres 3 sensors one on each front wheel and one on the rear diff that are for the 4matic. Just wondering fi this is true and if so if anyone has a picture of them or can tell me where they are?

 

part of the abs system and a speed sensor for the trans on your model ,I think.The two front ones tell the speed of the wheels to indicate traction loss so that the clutch in the 4 matic system can send more power to the wheels that need it.http://catalog.autopartscorner.com/b...1&make_code=MB
only pic I could find,autohausaz.com can quote them cheaper.

a crash course on your system can be found under 4matic wiki in google

 

the problem i'm having is the 4matic likes to turn on and off randomly. However i'm 99% sure the transfer case is good. Which sensor controlls the 4matic the speed sensor or abs sensor?

 

Yes, there are three speed input senders. One at each front wheel and one at the rear differential. They provide the ABS system and the 4matic system with wheel speed input signals.
When wheelspin is detected, the 4matic system operates two clutches in the transfer case in three stages using electro hydraulic valves located under your car.
There is a planetary gearset and two clutch packs inside the transfer case, and by locking one clutch and releasing the other your car is changed from being rear wheel driven into permanent four wheel driven during the first stage.
At the second stage, if wheelspin is still detected, the later clutch is released again and the transfer case is locked.
At the third stage, if wheelspin is still detected, the rear differential is locked by means of the third electro hydraulic valve.

You can see pictures of the speed senders in the attached photo, although I don´t think they´re causing your problems, the occasionally blinking light. Sounds more like the pressure sensor located in the electro hydraulic valve set located under your car. - Seen it happen on several occasions..

Cheers,