Of course the ultimate solution albeit spendy is a 3.6 conversion from Renntech or Brabus. Either gives over 250 hp and a corresponding torque increase. I have been seriously considering this for my 300GE 5sp. You guys are right about the 5sp, I have driven G wagens with the M103 automatic and my M103 5sp feels like a hot rod in comparison. With 250hp and a 5sp you would have an M3 killer with a sweet tuned 6cyl howl. Good luck with your project.

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90 300GE 5sp
95 740iL