I drive a 91 318i with the M42 as a daily driver. Rotella synthetic 5w-40 is a great oil for this engine, and it is what I'd recommend.
be aware of the profile gasket... I'd assume it has been replaced, but watch all the same.
Won't be a daily driver for now. May see an occasional auto-x. Price is not an issue and not concerned about extended oc intervals, just new to bmw thus the question.
The profile gasket was done at approx. 60k. Thanks for the heads up though.
One of the nice things that you will find in your owner's manual is a temperature-viscosity chart. Not as nice as those made by MB, and it also conventional oil-centric, IMO, and lumps all syn oils into a "special oil" section, but useful all the same.
What youll generally find is that you don't want a 15w- oil in there if youll ever see temps in the range of 2-23F, and you always generally want to use a 40 or 50wt oil.
Like I said, I have used rotella syn 5w-40 in all conditions and it has performed excellently. I am currently running schaeffer's 9000 synthetic 5w-40 because Im trying to use only one single oil brand/grade in all of my vehicles. I'd still be running rotella otherwise, and it did great.
I'd also give the M1 10w-40 high-mileage a try. It is a good grade for the engine, IMO. I found that going to 15w-50 was a bit too heavy for good throttle response, and that 15w- oils in general, including HDEOs didnt pump nicely enough for me to consider their use all year round.
Another word of advice - use Mahle filters. Mann uses their EVO-top, which while great in many applications doesnt work as well in the cartridge device used on the M42. Ive tried purolator and found that it causes the oil light to stay on a tiny bit longer -perhaps it restricts flow a bit more. use Mahle and youll be using the properly designed filter that will work best.
Also keep the fluid in the diff renewed often. Id use a 75w-110 or 75w-140 amsoil severe gear. You likely have a Ltd slip, and the official line from BMW these days is to use castrol XJ 75w-140. These diffs are undersized, and hold a very small amount of fluid. They will get noisy very easily. They are not the same diffs as are found on the 325 cars, etc.
I run M1 0W-40 and a BMW filter in my 318ti now that it is no longer my primary track rat. I'd run Mobil 1 5W-40 TDT or Rotella Synthetic if I started tracking it again. The gearbox gets M1 ATF but I put RP 75W-140 in my LSD because a friend gave me a great deal($6/Qt). I change the oil when the SI indicates it, and I change the gearbox and LSD at every Inspection II(@30K mile intervals). I also fitted a Conforti chip and a UUC Motorwerks clutch stop, pedal bushings, and RK II shift knob. After 14 years of ownership and 115K miles it is still my favorite car- I'm still driving it every day-it's much more enjoyable than my Mazdaspeed-and it returns 28-30 mpg at 80 mph.