The bulb failure relay does not fail too often but if it does it can and can result in no break lights. You have established that there is voltage going to the green/yellow wire in the impossible to get to brake stitch. The lower, easy to get to, cruise control switch also has green and yellow wire going to it so don’t confuse this one. There is a yellow/brown wire coming out of the switch that goes to the bulb failure relay that feeds the brake lights. You can check to see if you have 12V there when the brake is depressed.
One good possibility, sedans share one ground for all three brake lights. This is located behind the trunk trim that goes between the two brake lights. Check the ground connection first, cheap and easy. Wagons have two grounds so if one or two brake lights are working it is not the bulb failure relay.
The bulb failure relay is a large round relay located here: http://www.brickboard.com/FAQ/700-900/ElectricalCircuitsRelays.htm#RelayLocations You will be able to see it with a flashlight behind the fuses but access the relay by removing the cubby above the ashtray. It is held in place by two screws behind the trim around the cigarette lighter.
New relays run about $50, from a salvage yard, $5 to $10, ebay prices run from $5 to $20.
http://cgi.ebay.com/ebaymotors/Red-Volvo-bulb-out-relay-86-95-240-740-940_W0QQcmdZViewItemQQcategoryZ42613QQitemZ8027768049QQrdZ1
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Tom F. Three Bricks, maintain two more.
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