If the engine smokes at start up, it is usually valve stem seals or a dripping carb or injector depending on the color of the smoke. Or coolant which is another issue all together! It takes a lot of oil burning to make a visible cloud. The amount of oil seeping past valve stem seals while the engine is running will not usually be visible to the eye. A slow seep while off can lead to enough over a few hours to make the cloud on start up. So, if there is no start up smoke, then I would bet that it is not the valve stem seals. I'll try to clarify where my problem was. I failed to take photos, so I'll try and locate enough to work. I take no credit for any photos in this post.
1) To clarify some points first. The Vanos system creates a low pressure vacuum situation in the intake manifold. That makes venting the crankcase a little more difficult than other engines.
2) BMW changed from an external oil separator and diaphragm system to an one that is integrated into the valve cover. This seems to have been done to stop the freezing of the system in cold weather which led to oil being sucked into the cylinders and hydro locking and destroying the engine. I'm not sure, but I think I recall the change was from the m62 to th n62 engines. Someone else can correct me if I'm wrong.
3) here's a quote from a manual where it calls the diaphragm assembly the " pressure control valve and says that it controls the crankcase pressure.
" The remaining vapors are passed to the engine for combustion via the pressure control valve (5) in the intake manifold. One labyrinth separator with a pressure control valve is inte-grated in each of the two cylinder head covers.
The throttle valve is controlled so that there is always a 50 mbar vacuum in the intake man-ifold. The pressure control valve regulates the crankcase pressure to a low 0-30 mbar. "
The manual link and is on page 12:
http://www.internetsomething.com/lpg...2%20Engine.pdf
I'll continue in next post.