I think you should start reading 740 boards. The 740 people have done more than one m6 swap. That's where you get all the stuff for the transmission/clutch aspect. I think the best transmission for this is 420G or the other manual transmission that came in the late 545 V8s with manual. That's been tested.

Do not use M3 transmission even though it is spec'd for descent amount of horse. They don't make much torque, and M3 is an I6 engine so it won't bolt up. There were plenty of manual V8 sedans in the E53 era though. Use one of those. Watch the gear ratios. X5s are geared for a lot of mass and high final drive ratios. 5 series were not so much.

The transfer case is the problem.

The only BMW manual car with AWD is going to be a wagon, but they never had v8s. They are all built on M54 I6 variants (M50, M52 etc). I would get your transmission and then figure out how to adapt to and mount a transfer case. This is probably going to take a custom adapter plate and input/output shafts, but it isn't impossible. You can use the stocker, but it might be harder to modify to fit the original than use something else where you can custom mount it.

The L332 Rover that has the 4.4 engine came factory with a different transfer case than the E53 X5 with 4.4. It has a low gear on it and is spec'd for a slightly higher vehicle weight than the BMW unit, because the rover is a fat, fat pig. But it came factory and bolts up, and probably can take more torque than the NV125 or the later motor-based units that came in E53, which are aluminum, lightweight and chain drive. It's heavy and expensive compared to the NV125.

You could go completely off the deep end and use a non-BMW/Rover transfer case like a Dana 300 (has been done with a 3.0 by a member here) but he had to flip the case AND have a custom adapter plate machined AND had new propshafts made. The problem with manual swap on 4.4L in E53 has always been, to my mind, the transfer case. That's why everyone who has done it (all two of them or whatever) go RWD. Do it though, I have been thinking about this for a long time.


edit: apparently the machine is not taking hard returns today. sorry for the block'o'words.

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2001 E53 3.0 5pd