What would that problem be?

The light is controlled by the solid state device in the timer unit. It is a "synthetic" indication with little real purpose and no actual impact on the operation of the preglow timer.

I'm not sure what the problem is but why would a problem continue if the relay was replaced.

__________________
1977 300d 70k--sold 08
1985 300TD 185k+
1984 307d 126k--sold 8/03
1985 409d 65k--sold 06
1984 300SD 315k--daughter's car
1979 300SD 122k--sold 2/11
1999 Fuso FG Expedition Camper
1993 GMC Sierra 6.5 TD 4x4
1982 Bluebird Wanderlodge CAT 3208--Sold 2/13

Could be that there is an intermittent issue with the key circuit such that the timer is being reset continually. Next step would be to replace the key switch circuit with a known good source of 12 volts and see if the timer behaves normally.

The current situation is workable, provided that the key is not accidentally left in the #2 position.

Agreed. I thought the first relay should have been checked with an alternate 12 volt source.

__________________
1977 300d 70k--sold 08
1985 300TD 185k+
1984 307d 126k--sold 8/03
1985 409d 65k--sold 06
1984 300SD 315k--daughter's car
1979 300SD 122k--sold 2/11
1999 Fuso FG Expedition Camper
1993 GMC Sierra 6.5 TD 4x4
1982 Bluebird Wanderlodge CAT 3208--Sold 2/13