I've owned both M3 and 135i at the same time. I let the 135i go a few weeks ago as it was getting a bit squeezy in the garage with 3 cars (the wife has an X5). To be truthful, once I got the M3 I hardly ever drove the 135i but when I did it brought a smile to my face. It had the SSTT chip and the low down torque really launched the 135i into hyperspace. The decision to go from 2 doors to 4 doors was also driven by the fact I have three kids and do the school runs.
The M3 and 135i are like chalk and cheese IMHO. Build quality on the M3 is better and is a better package overall.
I love both cars but if I had to pick one to live with for the next 5 years, the M3 wins!