Yesterday, I had a #12 steering module installed in my 2/00 built 528i, replacing a #11. Both keys now set the steering wheel and seat to the position previously set when that key was last used. This is as is is supposed to be. With the #11 module, the steering column would telescope in and remain in with the key memory programmed on. It looks like a definite fix for 2/00 built 528s.
See the comments posted from yesterday for more information.