the thing that you would need to keep in mind is that your 318 is a base model 4 cyl. You would be converting it to a high performance engine that is a 6cyl. That means changing motor mounts and all kinds of stuff under the hood. Additionally, you would have to beef up the suspension, steering, tires etc. If you did do it, naturally you should get one out of a 1997. Why do you want an m3 engine anyway? Just buy an m3 or get a chip, cold air intake etc. You can beef up your car without removing the engine. By the time you get done changing everything, it is going to cost more than the car is worth. Once you start fooling around with that kind of upgrade, you could be inviting a host of other problems as well. Besides, you have a base model anyway. Just buy another car.