If you want to understand the engine's performance, you might check out the Top Gear comparison between a 545 versus 535d as it really explains the differences albeit in a sedan (around a racetrack).

It's available at metacafe - just google bmw, diesel, top gear.

More than anything else, this should answer questions on the engine "performance issues". A majority of X5's in Europe are diesels so the set-up is well tested and reliability is reported as stellar.

We get our 2010 35d on Friday and I can't wait.

BTW, your thread title should have a question mark rather than being a statement. Minor thing but the implications are clear.