Thanks. New pics will arive soon!
Here is a great paragraph from wikipedia.org supporting the 2.7i.
For the 1988 model year, the eta cars got a refresh from the factory. This included a newer Bosch Motronic version with adaptive idle control, a 325i head casting with the larger valves, ports, revised combustion chambers and water jacket, new pistons to fit the 2.7 L stroke with the 2.5 L head, a dual exhaust system and a 5300 RPM rev limit. Though it only made slightly more power in stock form, it could be easily boosted by bolting on a 325i head, a complete 325i intake manifold and throttle and plugging in the 325i engine control unit. Depending on which cam, chip and intake is used, the combination can make over 180 horsepower with the stock compression ratio.
http://en.wikipedia.org/wiki/BMW_M20