Owned both a e92 335i (N54 engine) and now an e92 M3.
Like most have said, 335i was fun, good torque on the low end and great for spirited driving. - take note the N54 engine was troublesome, had a bunch of work done under OEM warranty including VANOS issues and the much hated fuel pump issue. Gas mileage was good for a car that I would consider sporty when it needs to be.
Cons: Tracked it on a small tight course up here in Mission, the lack of an LSD sucked balls out of corners.
Loving the //M3 8 cylinder goodness. The car is superior in every way: handling, smoothness in power deliver, and just pure driving experience. Also 6speed is > auto. Haven't tracked it yet but am looking forward to the summer.
Cons: If gas is like mexican beer then the M is like:
