Hi Otto,
First of all very NICE NICE NICE project.
I talked to Henrik yesterday, asking him about motorsport parts for a M42/M44/S42 engine. And he told me that if it wasent for you then there world be nothing for S42.
However i have the last time searched some information for the M42/M44/S42 engine. Im almost finished my M20B27 project. And its far from a normal 2.7 liter engine

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http://www.bilgalleri.dk/html/alb_vis.asp?AlbumID=1730 )
But back to the case im speculate in building a S42 engine (sort of) in the future for a E36. But i need some more knowlegde of this kind of engine.
I would hear if you got some material catalogs from BMW Motorsport on this type of engine? i thinking of using the M44 engine block due to bigger standard bore and that it contains oil nossles under each piston over the M42 engine block.
I want to build the engine using a 85mm crankshaft (Motorsport, 4 counters) However the problem is that BMW motorsport informed me that the motorsport crankshaft only is 55mm at main bearings where the M42 is 60mm. Any solution to this?
BMW supplied me with some parts numbers however i dont know what this is can you tell? 1416576 disc for mean Bearing (axial clearance) 4x.
Does that have something to do with the smaller axial ?
I thinking of building the engine using some custom pistons from kempower, 86,5mm bore and 12:1 in compression with 145mm conrods?
The head i read some place that i can use S50 solid lifters in a M42 head and using shims under then, is that correct? Dbilas also supllies Mechanical bucket tappets is that a direct replacement for hydro tappets or does something need to be changed? I also looked at the Metrics Mechanic lifters but are they good enough for a 8500 engine using 292 degree camshaft?
The head will come from a M42 engine for use of the 6mm valves. however some bigger valves are properly going to be used. But for a start maybe. I think i will consentrate on the bottom end as the first.
Maybe you know some more about the S42 differenses from M42 engine that i need to take into account before starting this project. However the M20 engine needs to be finish at first

Best Regards
Thomas Nissen