The motor rebuild is turning into a slow burn. I figured any delays would be on my part, but it also turns out the machine shops I'm using are quite backed up. Not a huge deal though since it gave me time to get the transfer case into the X5. Until this week I also didn't have all the parts I needed to put the bottom end back together. My crank bearing cap shells and bolts arrived, along with some of what I need to get the oil pump converted. I'm still waiting on the o-rings to the tubes, and a few other misc parts. I also expect an ebay upper oil pan to arrive in the next couple days. Assuming it is in good shape, I will need to get an appropriate -AN fitting to have welded onto it where the X5 oil separator return line would go (on the X5 upper pan). Then I can source the hard-line that bolts to the back-right of the motor and sends the oil from the separator and the CCV valve down to the pan. On the X5, this line has a banjo fitting that goes into the upper pan, so my plan is to chop the bottom of the hard line off and fit an appropriately sized -AN line for the last few inches to the pan...I think something like a 4AN might do nicely as I seem to recall the hard line is around 1/4" OD.
My ebay oil pump showed up and while dirty, seemed fine until I took it apart for cleaning. Unfortunately the housing that the outer rotor fits into has some significant scratches in it - deep enough that I can feel with my fingernail. The rotor itself is steel and is in good shape. Clearly something got into the oil pump and did some damage. I'm not sure though if its enough to matter, but I'm leaning towards buying a new pump.
On another note, I pulled my OE transfer case apart and took a quick look. I was interested in what a 170k E53 transfer case looked like. I may have been my imagination, but I felt the drivetrain was getting sloppy, and I did have that infuriating "ping" noise when selecting D or R. In the past two years I've replaced the front driveshaft splines, put in a rebuilt rear diff, new guibos all around and changed the transmission fluid, all to no avail. After pulling the transfer case halves apart, frankly I'm glad I didn't do this before I committed to rebuilding an ebay xfer case. It looked pretty much brand new inside, with only a small amount of metal mud on the magnet. The chain had about 1/2" of slop in it...not enough to cause it to jump, but definitely about 80% more than the chain on the "new" transfer case after rebuild. The rear driveshaft output gearset/shaft does have a pronounced noise when spun, but I can't tell if that is bearing noise, or coming from the large dust shield that may be rubbing on the case. Regardless, the "ping" is completely gone with the rebuilt transfer case, so it was either coming from the t-case, or maybe the guibo was torqued incorrectly and the backlash of selecting D and/or R was causing the rear driveshaft to make the noise.
Since the LWX500 transfer cases are the unicorn of the two types used in the early, non X-drive e53s and parts are getting hard to come by for rebuilds. I may order bearings, chain and output shafts (if needed) from Cobra and rebuild this one when I get a chance since it is quite simple.
If anyone has any experience with the inside of these M62 oil pumps, I'd love feedback on the scoring present on the case where the outer rotor fits in. It was pretty cheap, so not the end of the world if I don't use it. A new pump is definitely more expensive, but maybe the way to go given how much damage can happen so quickly with a bad pump. Thanks all.