IMO you go for performance first. To improve performance the most, start with suspension: Koni/Bilstein sports and H&R springs, along with a good set of sway bars. Thats probably the most economical. Also get used sport rims if you're low on cash and don't already ahve them.
For your car you can also get a chip ( do a search) , which is what I would do.
Suspension gets you the faster cornering, and looks cool too, because these mods will lower your car and give it a more aggressive look while giving it more performance.
98 328i, black/black, manual, canadian sport pkg, ECIS intake, koni sport adj's, dinan springs, oe/oem clears.
Considering: tms shark,M 17" wheels, larger sway bars.