Responding based on a hunch and more pros here can correct it.
The swirl/scratch remover do remove a thin micro layer of the clear coat (depending on how much you polish by hands or polisher) to even out the swirls. In case of your merc, it seems like it doesn't have clear coat intact, so your swirls and scratches are on top of your actual paint and upon using this remover, its removing a layer of paint. Turtle scratch/swirl remover is known to be very mild and german paints are known to be very hard, so in theory this scratch remover by hand shouldn't fix the swirl removal issues. But if you are experiencing paint removal issues, high chances are you're without a clear coat. Continuing to do it may cause paint thinning issues causing the base/primer to start appearing at certain areas since by hand you wont be doing it in a very uniform manner.
Reasons for the clear coat missing could be a few including that you're working on a repainted/sprayed area that wasn't lacquered. Its possible that several buyers of the car have had multiple desi cutting cream sessions on this car eventually finishing its clear coat.
Again, this answer is based on my very limited knowledge and you should wait to hear from hands on experts on this forum.
