Furious_E wrote:
The 325e has the "eta" engine. Not very powerful, diesel-like redline, and low compression ratio so they are generally considered less desireable than the later (post '87) 325i engines. I beleive the head from the "I" engine can be swapped onto the eta bottom end, which I think is a desireable combo for boost. No real firsthand experience on my part, aside from having driven a 318 on a handfull of occassions, so don't quote me on any of that.
The M52 out of the E36 is a real sweetheart of a motor, though (and I actually can speak from experience here, having owned a 97 328is.) So torquey and smooth. This would be a much more worthwhile swap, especially considering that you can pick up a whole doner car for under $1k.
The "i" head (885 head) can only be swapped into SuperEta cars, not the regular Eta (which he has), IIRC.
btw, the M52 swap isn't just "drop in and bolt up" like some people seem to be suggesting. It's not a terribly difficult swap, but does require you to find some parts from other cars (like e34 525 oil pan and pump), a different throttle cable, a smaller brake booster (most people use e21 booster), alter the trans crossmembr, and a good bit of wire splicing.
If you look at the many, many threads about M52 swaps on the forums, it's generally accepted that such a swap is going to run $2-3k all told for a fairly basic swap. Sure, you can do it cheaper if you'r good at finding cheap parts and good at fabrication.
Also, your 318 has a small-case diff that will not last long running M52 power. And you'll probably want a different diff anyhow as the 4cyl gearing is not usually ideal for the 6cyl engines/transmissions.
So here's the thing? Have you driven the cars? My car was M10 for the first year I had it. No, it's not gonna win any drag races with minivans, but it's a decent little engine, totally indestructible, and with a 4cy in the car, the car is very lightweight (your 318i with the M10 is somewhere aroudn 2400lbs stock). Plus the M10 can take tons of boost if you go that direction. What is wrong with the M10 that it won't run? They're pretty simple engines, and there is a lot of knowledge of them (and parts) from the 2002 guys who have them as well.
The ETA - yeah, it doesn't rev real high. But it has a crapload of torque. We race an ETA car and you do a lot of rowing through gears, but it's still a stout engine and believe it or not a lot of Chumpcar teams run them in enduro racing.
The easiest swaps are of the engines that came in the car: M10, M20 (B25, B27, etc), or M42. All of them are essentially bolt-in other than some wiring and coolant hoses. All of them are perfectly fine engines.
If I was in your position, I'd just run the M10, sell the ETA, and use the money to pick up some go-fast parts for the car.
One thing I'll also mention: Your 318 probably has rear drum brakes, while the 325 should have discs. Swap the entire rear trailing arms/hubs/brakes off the ETA and onto your 318. It's pretty easy, you just need a different ebrake cable (IIRC).