We're talking flywheel HP, because its easier to get the data... I personally think that the newer 01' + models will be the car I eventually get. I am not sure if I should wait until 06' since the new bodystyle will drive the prices of the E46 down.
I saw an e46 M3 beside an 2003 B5 S4, there is no comparison. The Bimmer takes it all, it has the nicest rear end. Even on the newer 2004 S4, The BMW still takes it, I saw both, and drove the S's. Still haven't driven an M3...

But if it performs the way it looks, I won't be disappointed. Interior finish and texture is nicer on the Audi...
my 2 cents...