ok here is the scoop.
im considering this too. and i have a friend that does the auction thiong so he knows. 95% of the time, the flood damage is pathetic, these peopel will lik edrive through say... 8 or so inches of water, the muffler is submerged, they drive home fine and then call the insurwnce company like i just drove through a flood, and get a hook up, some of them seriously manage to stal, if it were say a stick, and the muffler may be flooded. then the car has trouble starting again because all that water is backed up in the exhaust.
99%of the time the engine itself and most of the interior doesnt take in any water at all. way to tell after its been sittin in the auction lot for a few days, go lift up the floor mats, feel all around the carpet, trunk too, is it damp, hmm, if it is be careful, most times it wont be, ruber seals around the doors remember. then start the engine, sometimes if it went into enough water they wont start, what my peeps do, is pop that hiid with a hair drier, most time its just a wet ignition system, im not to sure how that works with the moderen car tho. sometimes they idle funny, because there may be a lttle water in the wrong place. but for the most part, look inside the trunk and engine bay and the cabin, look for water marks, these are tell tall signs of how deep the flood was. if they already cleaned it up, i dont recomend buying it unless they can prove to you that the water wasnt high.
like eg. this 330i i asked my boy to check it out, it was cheap but look at all them water marks, not good, sure enough it starts but it idles funny, this one it seems was in some descent water.