Just got word back from the shop...Oil seperator was toast..Along with a number of hoses that had leaks in them. They replaced all of them and the seperator. Going to pick it up in an hour...I already had the valve cover gasket replaced...Whew! Finally done with this issue!!

would you mind to tell me you have 3.0L or 4.4L?

Yes sorry..I have a 2001 3.0

Does anyone know if the same problem exists in the MY '05 and '06 cars? I have an '06 4.4 and live in the Buffalo, NY area, where we get lots of sub freezing days and nites . . .

I believe the 04's and up, don't have this problem. They use the updated version of the part..

do you know what the average degree out there should have a chance to face this problem ? I am in NYC now, it is around 28F to 38F now !!

Does anyone know if it's recommended to replace the separator if you have never had a problem with it? I live in Ohio and it does get very cold but I have 150,000 miles on my X5 4.4i and I'm yet to have a problem.

It isn't recommended by BMW, and if you haven't had problems to date that is a good indicator that you won't have them going forward. You likely drive it such that the vehicle fully warms up, and the condensation in the oil is boiled off. At that point there is nothing to freeze.

IMO at that mileage it would be reasonable to change out the lines to the separator valve if you haven't done so. If you are changing the lines, it isn't much more work to change the separator valve, and it isn't expensive. Seems like a reasonable preventative maintenance step if you plan to keep the vehicle.

I am planning on doing this replacement myself. Does anyone have the part numbers and approx cost for the lines and the valve handy. I saw it once in one of my many searches but couldn't find them now :(

Go to realoem. go to engine......then cylinderhead......then oil seperator and you'll see prices.