Today I had the no-start issue permanently. Previously it was one of my keys which was prone to just turn in the ignition, but nothing happening. They key could be turned around endlessly. Yesterday I found the car with a flat battery. Really flat, no lights turned on, not even dim. Today I found out why, seems the car didn't fully turn off due to ignition lock / switch issue. I can now turn both keys around and around without any effect.
So time to take the whole thing out. Strangely, once out of the car I couldn't replicate the issue. My internet reading led me to believe it would be the mechanical part which failed. New one quoted by the dealer comes in at E 220. Not really cheap.
I wanted to make sure this is the actual issue, so tried to replicate the problem. I can now do this (without the switch attached, so ruling that one out as the source of trouble) by turning the key back quickly to the 0 position (or slightly behind, at least to the mechanical stop). Then turning forward again just spins the key and I can see that the part that should rotate the switch doesn't turn.
Next step, taking the key barrel off (again). This looks quite clean and I found no way to replicate the endless turns when I keep the housing fixed and turn the key. The lock side also couldn't do that. So I figured it might be the whole key barrel spinning in the lock mechanism.
Even further inspection revealed that the parts that the barrel connects to can in fact be pushed in when in the '0' position. I figured that if it would not spring back, the barrel would just turn because it connects to nothing. That part I was also able to replicate. But the barrel back on, pull the rod on the switch side and voila, the barrel keeps spinning.
So on the positive side I have now confirmed that my issue is the mechanical ignition lock assembly. And I now understand why the switch itself can cause issues which seem mechanical.
Next step: take the lock apart....