I dont believe the m-tech kit makes it an ///M, if it was well maintained I would say It would be a good car but I would be trying to get it for less, also its a vert so there are other possible problems.
With the rack i think you could toss a z3 one in and reduce the number of turns lock to lock but there is some modification that needs to be done to get it to fit correctly, this probably would cost more then you want to spend.
Good luck with your hunt and hopefully you will come out with a Bimmer at some point.
Might also want to check out e30tech.com if you are looking for an e30 they usually have some cars up for sale and lots of good info.