  We present a dynamical study of $e^+e^-$ production in C + C and Ca + Ca
collisions at BEVALAC/SIS energies on the basis of the covariant transport
approach HSD employing momentum-dependent $\rho$-meson spectral functions that
include the pion modifications in the nuclear medium as well as the
polarization of the $\rho$-meson due to resonant $\rho - N$ scattering. We find
that the experimental data from the DLS collaboration cannot be described
within the $\rho$-meson spectral function approach. A dropping $\eta$-mass
scenario leads to a good reproduction of the DLS dilepton data, however,
violates the $m_T$-scaling of $\pi^0$ and $\eta$ spectra as observed by the
TAPS collaboration as well as $\eta$ photoproduction on nuclei.
