Owning a M5 for two years I would take the M3. Purely on the basis of it holding its value better and the coverage of Motorplan. My heart would say a M5 my brain would say a M3 if you getting a good deal on it.
Totally agree with George here :thumbsup:. I was faced with the same problem last year when i sold my E46 M3, i really wanted a M5 but they are now discontinued so it was pointless in buying one then and late models hard to find, which will give you the most out of the motorplan. However the M5 is a beast, 0-100 might be similar between the two but after that the M5 is in a league of its own and is brutal at the top.
But don't base your purchase on the gearbox, both have there flaws. Many guys tell that the SMG and dual clutch systems are rubbish. But drive them for a while and then tell me. The SMG 3 in the M5 in much better that the SMG 2 in the e46 M3. Its more refined and isn't as jerky as the SMG 2. As for the DCT its just some thing else .