[augapfel]

Regarding the creaking noise, you have a worn/dry steering linkage part. There are no lubrication fittings on a 124 so part replacement is the only option. The problem could be the idler arm, the drag link, either left or right tie rod assemblies, the lower ball joints, or even the struts. Try to get a better idea of where the noise is coming from.

What do you mean by "there's still a bit of pressure when i move the transmission out of park"? Pressure where? You feel it at the shifter? If you're parking on any kind of grade and not using the parking brake you will have this. All I can think of is that turning the wheel moves the car enough to unload the parking pawl but that seems unlikely.

The bushings went bad because the diff weights a lot and it's been hanging by those bushings for 20+ years. I don't think there's any other connection.

 

[theblueprince]

the pressure i'm talking about is similar to depressing the gas pedal a bit and then putting it into gear. just a little, like right above 1000rpm. not really pressure i guess, it's a little jerk. but then when i turn the wheel it slides into gear with no jerking at all. but it's a minimal thing, stronger in reverse than into drive.

the sound of the creak is definitely near the dashboard. sounds like it's right behind the instrument panel area.

thanks again anyone.

 

[theblueprince]

the creaking sound doesn't sound metallic. like plastic or vinyl creaking.

 

[merc-one]

Hmm... creaking.
One common place on many cars is the horn contact ring - this was the case with my mom's Volvo 850, and my brother's Audi S4.
Alternatively, while I haven't looked, I'm willing to bet that the shaft to the steering wheel has one or two universal joints. If the turning movement feels like it is binding at all I would look there.
Without being able to hear your noise, these are only guesses.