So...vibration... following Performance BMW's advice, I replaced the entire rear suspension, then all 4 drive axles, then the tires, and then they finally warrantied a new rear driveshaft. Problem still present, no change. They told me I could start replacing parts at my expense - transmission, transfer case, or differential. They didn't know which one it was, and it would be guess and check. I called BMW North America, and was fed the same line.

Bottom line. $4200 later, same symptoms, and no further along with diagnosis or repair.

I found a local shop - Performance Chassis in Cary. Mark and Andrew really took care of me over there. It was a bad differential.