I own a 1992 BMW 535iM. The e34 platform lasted from 1989-1995. There were 5 sufficiently different engines available. I will be reviewing one with the 3.5 liter M30B35 inline 6. The differences between the cars, other than engine and transmission options, are minimal.
The engine is very good. It is very smooth and has enough torque to accelerate in any gear. You do not need to downshift unless you want to, even in 5th gear (it might just take a bit longer). The single overhead cam design leads to a slightly uneven power curve which makes the automatic versions slower/less exciting than the manual versions. Gas mileage is poor. I get 14mpg in the city and 24 on the highway.
The 5-speed gearbox is a Getrag 260/6. It is a tough box and has very defined, hard shifts but is still easy enough to shift with just your fingertips. It is smooth, though at this age the synchros are a little slow. The gear ratios are well thought out, though first gear is a little too short.
The interior is wonderful. At 15 years of age I have no rattles and the leather and plastics show little signs of age. The driver-centered controls are placed well. There are a few minor downsides; the forward-facing vents can only blow air conditioned (the AC works really well, even though it's been converted to R134a) or outside air. Only the windshield and floor vents will blow heated air. This isn't as much of a problem as it sounds but it is slightly inconvenient. There are NO CUPHOLDERS. The Germans at the time believed you should be drinking while driving and while they're probably right, it is inconvenient.
The on-board computer provides convenient readouts for range, MPG, outside temp, time, and max MPH.
The ride quality is comfortable and responsive. The handling is precise and the power steering system is very heavy. I like heavy steering but many people do not (look how many people drive Toyotas).
Reliablilty is good, but near-constant maintenance is required. It has never left me stranded. It is a very well built car, but slightly complicated to work on. It requires a lot of tools since it features virtually every kind of bolt (12-pt hex, 6-pt hex, male and female torx). If you can do the maintenance on your own the cost isn't too bad. A dealer or BMW mechanic will charge a lot, though.