You probably got yours fixed by now, but I'm having a similar problem on my 95 540. The best part is that there's about 200 lbs of drywall cement trapped inside. I'd really like to get that outta there soon.
Pretty sure we have the same rear deck, could be the same issue (or not). Mine has rust around the button and it's been hard to push in for some time despite me keeping it well lubed. Now it pushes in but the latch doesn't release, trunk won't budge. It hasn't locked since I got the car 2 years ago.
I'm going to try talking to my mechanic and the dealer before I bust out the drill. Hell I'm not even sure where to start drilling. I'm afraid replacing the deck lid might be the simplest option. I'll post updates. Lemme know how yours works/worked out
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