Where have you gotten your M535i to 140 mph? And do you do it regularly? In Europe, it's fine to keep the higher gearing. In fact, BMW has geared these cars very well for euro driving conditions. My problem is that it's nowhere near what we see in the US. That is why going to lower gearing (numerically higher) is so beneficial for US driving conditions, you optimize the car for the driving you do, so you can fully use it.

Another point is that gearing is also a torque multiplier. So even though you're putting down "x" amount of power from the engine, the rear wheel torque will be greater with a 3.25 than a 3.07.

Overall gearing in 5th, is 1:1, so the only effects are the changes in rear diff:

Estimation from Dinan power curve of an M30 B35:
RPM - bhp - torque - (Dinan bhp) - (Dinan torque)
5000 - 206 - 216 -- 222 - 233
5250 - 208 - 208 -- 221 - 221
5500 - 198 - 189 -- 215 - 205
5750 - 186 - 171 -- 207 - 190
6000 - 175 - 153 -- 200 - 175
6250 - 157 - 132 -- 200 - 168
Note: 5750 is interpolated

Now, according to the calculations, you'll be at around 6166 rpm with a 3.25 and C/R and at 5825 rpm with a 3.07. So interpolate a bit to get more accurate torque #s. At 6166 rpm, stock torque will be around 140 lb-ft, and at 5825 it's around 160 lb-ft. Multiply by their respective torque multipliers (the diff), the rear wheel torque would be 455 lb-ft with the 3.25 @ 6166 rpm, vs 490 lb-ft with a 3.07 @ 5825 rpm. This is with a "stock" torque curve.

If you add in a chip, or do engine work on these cars. So...let's use the Dinan "curves" as a basis for what the specs would look like.

182 lb-ft @ 5...rpm, w/3.07 is 559 lb-ft.
171 lb-ft @ 6...rpm, w/3.25 is 556 lb-ft.

So, you're right to expect that the C/R with a 3.25 will loose a few mph of top speed, given only rear wheel torque considerations (which is a rough estimation considering that you have other factors to take into account), but it will be better if you do engine work to bring up the torque curve. This is an issue with Dinan chips on E28s and other engine work. But that's another story.

In conclusion, the lower the diff (higher numerical ratio) the higher the rear wheel torque at the same rpm, but at slower speed. And you'll have to do it for all rpm and see where the curves meet. That's the best way to judge, rather than straight out max calculation.

Chris Graff