My recent experience told me not to update whatsoever. I have a MK3 - 2002 X5 as well. I tried to update the software with a wrong CD format. It killed my MKIII while the wrong CD struck inside the unit.

I think all you need is to find the right updated Map CD version (2002 was too old) for your region. You can find it on EBay. Or you can buy a MK4 (DVD version) to replace your MK3 (CD version).

I am in the process to shop an aftermarket head unit with an amplifier built in and sell my original DSP + CD changer+ amplifier later.......Dynavin Android sounds good but not the mainstream product yet. I will go for a Windows CE 6 one.

Happy X5 driving.