[Obioban]

I had an e36m with s50b32 track car and have tracked my e46 m3 many times (~10,000 miles). Even with my e36 at <2500 lbs (and 380+ NA hp), I still preferred tracking the e46 every time. I was only able to make myself track the e36 so I wouldn't crash the e46... but eventually I missed tracking the e46 too much and recently sold the e36. (I also tracked my e36 US spec a couple times, back when I had it)

The e46 has a better engine, better diff, less chassis failure points (e46 needs subframe mount reenforcment… e36 needs front shock towers, rear shock towers, front sway mounts, rear sway mounts, RTAB pockets, and the subframe itself on earlier e36’s), a better cooling system (e.g. it has an oil cooler (e36 doesn't), much better diff cooling, etc), doesn't have oil starvation issues, has a WAY better brake system (especially if you buy a post 2003 car-- porsche race car's routinely retrofit e46 braking electronics because it gives them a significant competitive advantage), more tire clearance, much stiffer chassis, has more useful gauges (e.g. oil temp and oil level, neither of which the e36has), better aftermarket support. SMG... I don't like it, but it IS effective on the track. Fixing the overheat issue is cheap/easy-- most people just tweak the sensor, and it seems to be without repercussion to do so.

The e36 just went into BMW's classic catalog, too, which means parts are going to have longer lead times and be more expensive. The e46 is still 7 years out on that.

The e46 is no harder to work on than the e36. Nor is the suspension geometry better. In fact, mechanically, they've very similar-- the e46 is very much a factory worked over/improved e36 throughout. Even dimensionally, it's really only wider than the e36. The majority of the weight increase comes from the wider body, the engine, and the 6 speed-- the only one of those that wouldn't be a worthwhile track upgrade for an e36 is the trans, and if you really care about the weight difference (25 lbs), the 5 speed can be swapped in with no modifications (though if you're going to street drive it at all, the 6 speed is way better for nhv than the 5 speed in the e36).

Mostly, though, the e46 just drives a lot more nicely on track.

No contest, imo... and I bet few people have more experience tracking both of them than me. The real benefit of the e36 is that it's cheaper, and that's not nearly as true as it used to be. You can get a beat e46m for under 10k now if you hunt, and if you're gutting the thing for track use, who cares.