That pad is worn the hell down! But, what does the inside one look like? You mention that the inside of the rotor is smooth only the outer side looked like this. So, is the inner pad worn evenly with the outer? I ask because if not, you may have a caliper issue.
Do we not have sensors on the pads? I would think that the brake repl light would have come on.
Why not just get new rotors? I mean, brakes are pretty important and while I understand just because we drive M3s doesnt mean we have assloads of funny money, but why not just get new a front setup? It cant be THAT expensive...
"With great power comes great responsibility." -El-Superbeasto