I would have to agree with fernguy. That would actually be the first place that I would look. I have seen that happen several times. If the ignition switch is not your problem then I would begin my focus towards the DME and it's connectors. The E36 has the potential to gather moisture and condensation in the cavity where the dme is stored. I have also seen connectors work themselves loose. However, I believe that you will find your problems within your ignition switch.
fernguy... are you a tech or have you just experienced this problem with your own car??
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