What a load of crap and a dramaqueen. Here's the problem most people have these days. We romanticise things. Sure the M3 E30 was a great car, as a matter of fact it is one of my favorite BMW's, but this car wouldn't have hit the streets if the DTM rules at that time didn't stipulated that the racecar should be sold to the public. But times change, hell even the DTM changed, nowadays there aren't any championships with homologation rules. So you can dream about taking a standard BMW coupe tweak it (because that's what hapened with the E30) and compete against the Ferrari's and Porsche's of this world but that is you living in La-La land (no, not L.A.). If you want to compete with midengined and rearengined racers you'll have to adept the whole car as they did.
And they're doing a pretty amazing job in ALMS and DTM. They also didn't do a bad job in F1 it's a pitty but sensible retirement of F1 because business before pleasure. But the point is if you wanted BMW to make streetversions of the ALMS and DTM cars you will need to tone it down, make sure that it meets regulations, make it comfortable enough for the general public and after all that you need to keep costs down. So what will you end up with? Precisely the M3 as we know now.
So for as the roadcars. Sure the M3 isn't a homologation model but is it a bad or shitty car? No. Last time I checked it was still the standard for it's class. Hell it even competes with the Porsche 911's of this world. How good the M3 E30 was, it never challenged the 911 at that time. So there's progress.
Are the M5, M6 or 1M bad cars? No. They're fanastic cars. And that's the point as it ever was of M. They make the standard cars that are great even better. Remember the original M5?
So, is BMW M dead? No, not by a long shot, it's just BMW living in reality and not in la-la land.