I've had a good read of your project, it interests me highly since this what I'm doing to my UK E21 316, my thread can be seen below. I haven't got that far with the engine swap due to life getting in the way, but the M10 is removed and my M42 is nearly done. Replaced the profile gasket, and all the timing gear. I should be getting it done towards the start of August though.
http://retrorides.proboards86.com/?board=readersrides&action=display&thread=36272&page=1If you don't mind, I'd love to ask a few questions. A particular concern at the moment is how to mount the motor. Did you just make bolt on convertors? How were these made, and it'd be great to see detailed pictures or plans if you have any. What driveshaft are you going to use, and with the motor in that position, is it a straight fit?
I've heard off another UK m42 conversion based on an M10 car and they bolted in the engine using the standard inlet side engine mount, and fabricating a new exhaust side mount. I was planning to do this, but how you've done it is very interesting. I'm just wondering if our engine mounts are the same both sides of the pond though.
Sorry for the mass of questions, but keep up the good work. I've book marked your project thread so I can see how you're getting on

Cheers,
Rob