Did you not get my PM about 12 hours ago?
You can download teh Bentley Service Manual here
Yes, you will need to replace the sensor. You would not have needed to do that if the brakes had been replaced before the light had gone off, however.
(for your car, just think ASC+T instead of DSC)
Originally Posted by drz
There is no electronic version of the E36 manual. BMW started providing the manual online for E46s and newer...
The first light, if surrounded by an open circle with an arrow tip on one end, is your ASC+T (Automatic Stability Control + Traction) light. It will be on whenever you have disengaged ASC+T (via the green button in the center console); it will illuminate intermitently whenever the ASC+T kicks in; or it may be indicating an ASC+T failure.
The second light is the brake pad wear sensor. If the light is on, your front pads, or rear pads, or both need to be replaced very soon.
Best of luck with the BM, and welcome to werkz.