I have a new car and a used car. One is a 2004, the other a 1993. They are worth about the same, have the same peak horsepower, come from the same manufacturer, and are both manual transmissions. The new car is my daily driver, the old car my weekend/track car.
If I had to choose one, the new car would be out the door.
I have had new (2004 TL and 1995 Altima) and used (1987 Legend, 1988 Legend, 1994 325i) cars for daily drivers.
I would not hesitate to buy a well-maintained used car with a warranty as a daily driver. Indeed, Certified Pre-Owned BMWs may come with more of a warranty than a new BMW (factory 4/50 plus CPO 6/100).
It is all about finding the right used car. You can buy CPO or Audi Assured from a dealer and get a warranty. You pay a premium for that piece of mind. From a private party, you just have to make sure the car is thoroughly inspected before you buy it. Plan on spending $100 or more for your favorite mechanic to spend the day pouring over the car.
BTW, thanks for propping the X, guys. I would hate to put the knowledge smack down on some of my fellow bimmerphiles. Now if I could just get the TL guys to stop fighting with the G35 guys . . . (not including Mr. E, AFAIK).
Oh, and about the years for specific models, you have to distinguish between US models and European models, as others have mentioned. E46 Sedans arrived in the US in 1999, Coupes and convertibles (?) came in 2000. 1999 model M3s, coupes and convertibles were E36.