Well, after more than a week in the shop (got a 07 530 as loaner, sweet driving machine), the total damage came out to be almost $2300. Dealership covered 25% of the cost and labor. Service advisor was helpful in trying to get the price down because he has not seen this happening in his career for a low mileage X5 like mine. Hats off to Mario of BMW Dallas. Mario is one of the best SA I have met in this dealership.

Also, I contacted BMW NA about this, and they tried to help but was not able to get goodwill warranty for this. Naturally I was disappointed at their response.