Yes, you can retrofit the factory navigation system. The E38, E39, and X5 all share the same audio, video, and navigation systems, and except for the brackets, the retrofits are pretty much the same. (The E46, and E83, and E85 also share many common components.) There are many well-documented retrofit example projects here in the FAQ pages as well as on the Bimmernav Navigation forum (
The Navigation A/V Forum). The hardest part is running the navigation harness from the trunk to the dash. Otherwise, it is pretty much plug-and-play after the harness is in.