Software upgrade is HUGELY worthwhile. It makes ther Mk3 MUCH better.

Do a standard upgrade first before you change splash screens etc.

Make SURE the OS disc is Mode2/Form1 otherwise you will crash the Mk3. Take all the usual precautions with upgrading: make sure battery is good, leave ign on at all times, don't interrupt the process etc.

The GIF file is embedded in the usw_load file.
Info here:
http://www.bimmerboard.com/forums/posts/371867/