Just for grins, here are pictures clearly showing the red coating Mercedes used on the inside of the block and trans case. This is a '60 220SE motor and trans and the block was hot tanked already. The black exterior paint came off, but not the internal paint. I am going to use Glyptal paint to recoat and not sure what the original was. Glyptal has been around forever though. You can also see the red coating also appears on the outside around the IP opening. It would appear this coating was sprayed and some bled over.
The exact same coating was used on the inside of four speed transmission on this car W128 car. The attached shows the Glyptal paint already painted in the box. BTW, you can get Glyptal from Eastwood. Ain't cheap.
Not sure when this coating started or when it was stopped, but was on the '60 for sure.