I've heard the same thing about length of time between major rework (7 years). I've been following the 3 series since the early eighties, and have noticed that trend has held true for the past four generations of the car. After talking to a bunch of enthusiasts (at my dealer and other places) I'm betting the new 3 series sedan will debut as a 2005, the coupe and convertible will receive minor interior tweaks in 2005, but the sheet metal will remain the same as the 2004. In 2006, all hell breaks loose when BMW introduces the completely reworked (and feature-rich) 3 series coupe and convertible -- based on the new sedan released a year prior.
I'm still wondering if the 4 series moniker will stick. Back when the E36 was introduced, and the coupe model followed, rumor sites said the hood line and trunk line were so drastically different than the sedan that BMW may call the car a 4 series. As we all know, that never came to pass, and the 3 series name held. This is going to be an interesting couple of years for BMW -- and those of us who love them.