Don't worry, nothing has fallen off, that's just how the bumper is molded. Don't know why, maybe to direct airflow.
The lights work very well are easily worth $300, but whoever quoted you $1100 is really trying to rip you off.
Yes, you can install them yourself, a number of the people here have done it. It took me about four hours or so and it's well worth it.
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Chuck
'01 MB EX-NAV Pics and Projects
[This message has been edited by ckonarske (edited 04-16-2001).]