a new key in the US will run you from $100 to $150...

Send me money I'll buy you the key here and mail that shit. Just get it cut and programmed.

Dave, don't buy a thing from the dealer in Australia. I buy all my parts from the USA and get them shipped to Australia. There are heaps of guys on this forum as above that are willing to help you out. The one thing I have bought from the dealer was an Oil Pressure Sender because I needed it ASAP and it cost me $60 AUD. If you look at ECS they are less than $10 USD.

Well you can do what I did. You can keep the nice Remote key for alarm funtions/looks and use a BMW wallet spare key to start the car. They cost around $40-70 depending the dealer location.
BMW E36 Keys | BMW E36 Blog

Whats involved in getting the transponder programmed? - Or is this where its ordered from my VIN?

Coding the transponder is a completely different thing to coding the key to operate the central locking. There's a guy here in Perth that can make new keys from scratch at about 20% the cost of the dealer. He's an electronics and software engineer so he definitely knows what he's doing. I recently had a complete new key made plus a new battery and circuit board in my old key to keep as a spare for $300. The dealer was going to charge me $950 for just the new key. I'll PM you the guy's details and you can see if he can help you.

Glad I saw this, this looks like something I would've drunkenly bought one weekend. I have both masters, but the lock button on the second master doesn't "click" anymore, so can't use it to lock the doors.

the keys normally are paired to EWS, and the EWS can take no more than 10 keys in its lifetime - if there were 10 keys already programmed into the EWS, for the next key you will need a new EWS module. i think there can't be more than 4 keys active at any given time... so, when programming a new key, one should bear in mind that info...