Transfer Case Replacement, does this make sense?

Good Morning All

I brought my car into the dealer to get a list of problems fixed. This is a 2006 CPO ML 350 with around 43k miles. Keep in mind I bought this car on 2/15/2009. This is the 3rd trip to service. The list is as follows:

• 
  Creaking coming from front of the car when going "up and over" road bumps, driveway, etc (rear spring couplings replaced last visit to address same in the rear, rear is fixed) .

• Navigation unit added after initial sale, won't display NAV in instrument cluster; I told the dealer to update the FDOK with MB and then they will issue a new code to flash the cluster with, dealer did that, still doesn't work

• Rough 2-1 downshift, repeat issue, ECU already flashed last service visit

• Popping sound when accelerating into left/right turns coming from front of the car more so toward the side you are turning into, and you can feel it through the steering wheel.

• At highway speeds getting a noticeable vibration in the steering column/steering wheel shake

• Driver side seat squeaking, repeat issue, was fixed back in late feb, its back again.

My main concern was the rough 2-1 downshift and the popping sound when accelerating into left/right turns. Last visit the dealer flashed the ECU for the rough 2-1, the tech said they couldn't reproduce the issue. While it is true, it can not easily be reproduced, it seems to be most prevalent when driving 10mph or less either in traffic or when looking for parking spots in a lot. The 2-1 was so rough one time, my wife thought i hit something when going through the parking lot. "No hun, that's just the shifting in our wonderful new (to us its new) ML". It doesn't do it every time, but when it does do it, its noticeable and annoying.

The other issue is the popping when accelerating left/right. On my prior visit to service, I would get a popping when turning the steering wheel all the way left or all the way right even at a stand still; that was fixed. Now when coming to a stop and then turning left or right and accelerating, until the wheel starts to make its way back to center you get a "pop pop pop pop pop" and by then the wheel is centered and its gone. The only thing I could relate it to is wheel rub, but these are OEM 17" wheels and tires, no mods.

So what have they fixed so far after 4 days...nothing, yet. They have ordered a new transfer case to address the vibration in the steering column/steering wheel shake at highway speed, but the other problems they haven't been able to reproduce (leaving out the nav issue). Really!?!...

Does that make sense to anyone to replace the transfer case to negate road vibration or feel in the steering column? Can someone help me to understand why this would be the root cause of the issue?

The dealer told me they rebalanced the tires which are new from being replaced with the CPO process, but they still experienced the vibration. I was just relieved they could reproduce one of my issues.

I'm hoping for a valve body replacement for the 2-1 downshift issue. The dealer has been really nice this time in wanting to get this fixed since this was a new CPO sale on 2/15/2009 and this is my 3rd trip to service.