If you want a luxury car... I somehow doubt you've driven both. Even if many people like the e46 M3 better, few would say it's a huge step forward. Its performance in this test was pretty disappointing.

Recall, the e36 M3 was voted the best handling car in america by Car and Driver, and similar things were said of it by Road and Track, Motortrend, and pretty much all the others. The C&D article at least is still up online. I do not think you'll see the current M3 rated quite so well.

The e46 has an alarming tendency to blow its engine when it's pushed hard, such as on the track. It's heavy, and feels it. A nice car, but it feels heavy and soft and remote compared to the e36 M3 (just as the e36 does compared to the e30). Quite a few people who have bought e46 M3s are disappointed and repurchase e36 M3s or move to a 911 or something.