After reading numerous posts, I am convinced I need to do the M20 flywheel conversion. If you recall, my GF was driving my 91 318i and the M42 self destructed with only 129K on the car. We don't what happened yet (I'm 11 time zones away) but I believe the chain tensioner failed and took the chain rail with it. Sucks to be me but time to make lemonade out of lemons.
I bought another M42 motor (160K) out of a 91 318is from a bayE30.net forum member. That 318is had been totalled in a spin on a wet road. The owner parted out the 318is and took the M42 with plans to convert from a M10 to M42 in his 84 318i. Owner had a change of plans after he scored a M52 motor so the M42 was offered to me. I bought the rear end, gearbox and complete motor for only $350 bucks. If the rear end is not limited slip, seller will refund me the $50 I paid for it. My 318i has the original clutch on it from the factory. With the motor out, this is the time to do a clutch replacement and while I am at it, replace the stock M42 with an M20 flywheel. I'm telling all this info to the shop in Berkeley CA (German Auto Sport) from halfway around the world so hopefully they don't think I'm smoking too much of the local stuff. I appreciate all the write ups everyone has done. I just copied all the links to the M20 flywheel writeups and forward them to the shop in a few emails and said do it. I'll let you know how it goes.
Before the motor goes back in, I am having the following done
-new timing chains
-new chain tensioner
-new water pump
-new oil pump
-new thermostat
-new hoses
-and new clutch with M20 flywheel (along with adjustable ICV)
When I get back from the sandbox in a few months, I'll let you know how the conversion turned out.
G-Man