Not worth the hassel for a C Class Benz. Government requires a letter from MB Canada for the import of the vehichle and either you won't get that letter or they will require you to perform some very expensive modifications to your car (e.g. swap out entire instrument cluster). With any other manufacturer it makes sense to import, but not with Mercedes. That being said...
- yes you have to pay state sales tax and PST and GST when you import it.
- Yes mercedes would honour the warranty.
- No it is not basic paperwork for a Benz.
- I assume you are referring to a break in period for your car...but yes you can drive on a highway.
For importing info....see
Registrar of Imported Vehicles RIV: How to import a U.S made vehicle into Canada
For info pertaining to most other manufacturers...here is a good article:
Canada-U.S. pricing dilemma