Hello
I have a 1988 240 wagon that i put new calipers/pads etc on about 3 years ago, soon after I got the car. Recently I was hearing a terrible grinding from the rear end, and found that my right rear outside pad had worn entirely away. all of the rest of those back pads were worn how you would expect after 3 years of not terribly heavy use.

Thinking that I had a stuck caliper, i got a new caliper, rotor (it had been pretty much destroyed) and new pads for the rear end. I put all of this on and went to bleed the system. Everything went as it should until I tried to bleed the new caliper. Instead of the pedal dropping when the bleed valve was opened, it stayed rather stiff, and very little fluid was flowing out.

From there, i began opening sections of that brake line back towards the proportioning valve. I took off the flex hose, and tried to press the brake - no fluid squirted out (i could, however, blow through the flex hose with no back pressure). I disconnected the line from the other side of the regulator, and once again no luck. I then disconnected the line from the proportioning valve, stepped on the brake and very little happened at first, then i got out from under the car for a moment and upon my return there was a big puddle of fluid under the proportioning valve, and it was still dripping out of the opened hole. I then blew compressed air through the main line to see if it was plugged, but it was not. I reconnected the main line, refilled the reservoir that was at this point rather low, because it had all ended up on my driveway, and tried to press the pedal. This time, the pedal seemed to sink like it should when bleeding a brake. Of course, the system was also full of air. I reconnected everything, and tried bleeding that brake, and it started to flow as it should, but then stopped after a bit of fluid had come out, and is now back to barely dripping at all and the pedal feeling hard.

Does anyone have any ideas as to what may be causing this behavior? Could the proportioning valve be doing something that it shouldnt? could it be something else?

sorry for the long post, and thanks for any help