1994-1996 540i Owners, or 4.0 and 4.4 V-8 Owners - Help!

["Muller, Mark V." <MMuller@xxxxxxxxxxx>]

I have never owned a BMW, but am about to buy one.  I've driven all the
other makes they sell here in San Antonio, and the 540i really puts the rest
to shame.  Now I know why all you guys (and gals) have such big grins on
your faces :))

But, I have a dilemma.

I can't afford a new 540i.  I only have enough money to purchase a 1994-1996
(maybe) model.  I've heard about the engine problems, and the 100,000 mile
warranty extension for the 4.0 V-8.  My question is: will I be a lot better
off looking for a higher milage 1996, or is it fine to buy a low-milage 1994
and make sure it has the engine swapped?  I have read all the details about
the engine swap, and I know how to tell if it's been done.  I am just unsure
about whether getting a 1996 with a 4.4 V-8 (I guess it would technically be
a 1997 model, since that was introduced in mid-96) would make a tremendous
difference in features and performance over a low-miles 1994 or 1995?  I can
just barely afford a 1996, and I would like to save the money for repairs
over time, or an extended warranty, since I want to keep the car about 10
years.  I will be purchasing a 6-speed, and not the automatic, if that
matters.  Also, if I find a nice 1994 with less than 100,000 miles, and the
engine hasn't been changed, will BMW still change it if I ask them to do it
(assuming it has a rough idle, etc.)?  Or am I all wet, and a car purchased
in late 1996 is really a 1997, and way out of my price range (under $30K)?

Regards ... mvm.  mmuller@domain.elided

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