It certainly replaces the 6 stack CD changer in the boot, and I did look for an interface to allow me to keep both the Dension unit and the CD changer. The bad news is that Dension could never get the CD Changer retention unit "stable" for the E36 according to them and discontinued manufacture of that retention unit.
My car came with the stock C33 unit with the cassette tape player, and all I did was swap it for a unit that was fitted to the later models - the C43 BMW Business Radio which has the single slot CD instead of the tape. It still looks "stock" (because it is!!) and has the same orange lighting as the original unit and the rest of the dash.
Like most things, I found my C43 unit on eBay