This a wiring nightmare, but I will give you a description for an amplied system. The speaker wire is the hardest to deal with. So to figure out which wire goes were there is a few ways to do it. Turn on your car stereo - yes people might freak at this. Cut one wire coming from amp. One speaker will turn off. Find the like wire with the strip and cut that. Connect these wires to your 3 way crossover if a front speaker. The upper one on the door is the tweeter on the dash is mids and lower one is the lows. So connect to the crossover the one that you cut. Repeat until your done with all 20 wires. The rear speakers will be connected to your four channel amp directly. The bmw amp is located in the left rear part of the trunk.
Put your new headunit in the dash, run two sets of rca wires -front and rear to the trunk from your new headunit - because of the tight depth for stereo install use right angled rca behind the new deck. Run one wire from the blue wire on your new headunit to the trunk (remote wire). Hook the yellow wire up to any constant wire, the red to the ignition wire or wire the comes on when you turn on the car. Ground the black wire to the car or to a grounded wire. hook up the antenna wire to the stereo. Your dash is done.
Take the rca's and the remote wire hook them up to the amp. Since your battery is under the back seat, take some short power and ground wire and hook directly to the battery. You might need to replace the battery terminals to hook up the additional wire.
Now run the crossovers to channel one and two and the rear speakers to channel 3 and 4. Turn the gain down on the amp for the front speakers. Tweak the volume (gain controls) to get the balance your want.
There is a simple harness that does work if their is no amp, but I thought all these cars had amps. Not sure since I have only done this install on two of these cars and they both had amps in them. I didn't use the harness, because of the amplier. You can still use the harness for the power and ground (Red, yellow and black wires) though so this would save some time.
Yes I do sell car stereo stuff and I own a 89 535i and have 2x12" subs added to this set up also. The car though would probably sound better with a single 8" sub for added support. Since my Alpine deck with built in xm was stolen last week, I am sure I will be changing things around.
You can run all the wiring back to the headunit instead of using an amp in the trunk. If that is the case then run the 8 wires to the head unit instead of a 4 channel amp. http://mobile-emotions.stores.yahoo....19wihapli.html