Make sure you measure the AFM temp sensor too, should be pins 4 & 5 on the AFM. According to the 3 series repair manual:
Coolant temp sensor @58degF 2300-2700 ohms; at 180degF 300-360 ohms.
Intake air temp sensor @68degF 2200-2700 ohms; at 122degF 760-910 ohms
I usually see pretty stable readings on the sensors, unless I can't get the leads attached pretty well. I'd think if the readings are close, even if they're not rock-solid, your sensor is OK.
However, I did have some similar troubles with my e24 recently. The position sensor controls spark on the older Motronic systems; if it's out of range, no fire. The resistance readings seemed to be in the correct range, but they were not stable. Once I replaced those sensors that problem was resolved.