1999 BMW 528i(E39) - data bus issue / engine control module issue?

Hello there

WORKING ON a 1999 BMW 528i (i.e. E39 generation) with:
- 2.8L DOHC engine (L6-2793cc - M52 TU)
- base instrument cluster (i.e. without IKE)

DEFINITIONS for the attached Data Link Connector Circuit
**A) OBDII plug - 16 pin connector at the very end of the left side of the dashboard / driver's left side kick panel just above the dead pedal
** 20 pin Data Link Connector - 20 pin BMW data link connector under the hood just in front of the RF strut tower
**C) Connector X60004 - 1 of 5 connectors on the DME (i.e. engine computer)
**D) Connector X60002 - 1 of 5 connectors on the DME (i.e. engine computer)
**E) DME - engine control module
**F) IKE - instrument cluster

BACKGROUND INFO
- car will start, idle/run, and drive no problems
- engine has a misfire
- I am not able to communicate with any module on the bus either through the 16 pin OBDII connector or the 20 pin connector

WHAT I HAVE DONE SO FAR:
- I checked all the fuses in the glove box as well as the rear of the trunk for power ; all is well with the fuses
- tried 3 different OBDII scan tools on the 16 pin OBDII connector - none of them communicate with the DME / BMW's D-bus
- tried a Mac Mentor (generation 3) on the 20 pin connector - no communication when trying OBDII or enhanced (i.e. manufacturer specific)
- when starting car, I have 12V at pin 2 of the 20 pin connector for about 10 seconds, and then it drops down to 0V
- checked out the 2 BUS systems
- I scoped the CAN bus (i.e. bus between transmission control module and DME) at the DME on pins 3 and 4 of X60002
- CAN H voltage between 2.5V and 3.5V and CAN L voltage between 2.5V and 1.5V. The CAN H and CAN L are miorror
images of themselves.
- I put a graphing mutli-meter on pin 7 [i.e. BMW's diagnostic bus (D-bus)] of the OBDII connector - I have 12V at idle
- when the scan tool (attached to the 16 pin connector) attempts to communicate, the voltage on pin 7 will fluctuate
between 12 and 0V a few times and then go back to 12 V where afterwards I get the message on the scan tool "make
sure ignition is on and scan tool is properly connected"
- disconnected the IKE (as it is the gateway module) - I still could not communicate with the DME on pin 7 of the OBDII connector

HERE IS WHAT I THINK THE PROBLEM IS:
- DME needs to be replaced

As always - thoughts appreciated and thanks in advance

Looking at your diagram my first thought would be probe pin one on the instrument cluster as pin 7 goes straight to that.

Then check pin 1 of dlc to pin 17 of dme. Then finally check grounds of dlc to the chassis. These year bmws have known issues with grounds corroding causing no com with scanner but still get good coms on data lines with a scope.
Just my two cents

Edit also did you leave dlc cap on while attemoting use of obd2 port ? Also did you put obd2 port cover back on when using dlc port? They have jumpers in the caps to complete conections ? Just a thought might also what to see if the dlc cap under hood is on as well.