e39_touring - I'd gone down a similar route but without changing springs up front or the lower air spring (bags) in the rear. I also am not trying to make an M car (I have one of those). I had a chance at B6 rear shocks (only on another E53 for six months) and replaced these first, VERY happy with the result.

I then upgraded the rear sway bar (my car had the 22 mm rear bar) to the larger diameter (23.5 mm) - this makes the car have more of an oversteer and flatter cornering. You can easily check which diameter you have with a dial caliper OR an open end wrench to check with size will and won't slip on the bar. Used bars are cheap on ebay, make certain you buy the type compatible with your rear suspension (coil vs. air springs) and suspension (std or sport).

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2002 Euro X5 (E53) 3.0 diesel (M57)
5 speed manual with UUC short shifter.
Pre-xDrive NV125 transfer case (chain & gears).
Factory Xenon headlights, Spyder LED tail lights
Updated vortex crankcase breather.
Motorsport dead pedal, factory fire extinguisher, factory first aid kit, factory F&R mud flaps, factory PDC

Bilstein B6 shocks F&R
Redline oil has replaced "lifetime" fluids (F&R diff, manual transmission, transfer case and P/S).
Dimple magnetic drain plugs in all compartments.