Matt,
I'm surprised you thought the current M3 had vague handling. I've never driven an M3 (E46 or E90) so I have no idea, but still. Perhaps you are one very tough customer to please. There are plenty of user reports and reviews which claim the E90 or E92 to have superb handling. Obviously you are comparing an E46 but I just haven't seen too many people complaining to be honest.
I've never driven an E46 so I have no experience with it and, in fact, the dealer who bought my Corolla (Velocity Cars) from me offered an E46 330i with 160000km on the clock for R99000. I gave it a pass due to the millage but otherwise I'm sure it's a fantastic car. But compared to the cars I've driven in the same class as the E90, I just felt it handled much better. Much better handling, better steering feel, less body roll etc. The Lexus was by far the worst of the bunch. I was expecting things from the IS250 and it was just terrible. But I feel that I made the right choice in the current crop of cars in terms of handling.
Like I said, I'm not a BMW fundie, I mean, the E90 is my first BMW I've ever owned, but I can't imagine the handling to be much better unless I got some wider rubber.
