Ah, let me jump in here. A little background first. Got the 2002 325i w/sport and step (wife's car now) as a retirement toy. Always drove a company car (Pontiacs and Buicks mostly, with some Fords and Chryslers thrown in); wife drove a Chevy wagon, Mazda and Honda, the latter two were slightly used and she drove these cars for about 8-10 years each. Get the picture? No deep pockets, just a regular guy with three kids and a non-demanding wife. So, on retirement, always having loved a sporty European car, got the E46 in 2000. Still have it, and it is just about ready to hit 50K. In 2005, I sold my 2000 Pathfinder (as I figured I wasn't going to use it to tow a flats boat here in SoFL, also sold my canoe...among many other things, fly fishing is my passion) and got my Z4 (2.5i). Always loved the TR-4s, MGB/A and Austin-Healy's of my earlier years, but of course could never afford them. So, here I am, like a pig in sh*t, couldn't be happier with both of my BMWs. I'm fairly certain that I will keep them for the rest of my life (I'm 70) and in great shape...so far. Now, how do I compare these two beauties?
Believe it or not, although they have the same engine, I could swear that the E46 (50K miles, Z4-15K miles) is the faster car at take off. Why this should be, I have no idea. Maybe it is in the break in period??? I love the interior of the E46, much more than the exterior. I've got black sport seats and I think that the beauty of the interior lies in the burled wood dash. To me, it is understated elegance...real classy looking. I can almost sit in the car all day looking at the dash. As for the exterior of the car, it is just so-so; for exterior pop, we've got it with the Z4...a real head turner, looks bad standing still. Don't think there is a roadster that can touch the beautiful qwerkiness of the Z4. My Z4's interior is aluminum on a tan background. I know that I am old fashioned in feeling that I would have preferred dark burled wood rather than the aluminum. Once again, it is the classy look that I prefer...merlot, tan ragtop and interior, dark wood grain. A bit of a throw back to the old days, but what the hell, I am an old fart.
Performance-wise, the Z4 is the one. Bigger sound from the muffler, better traction, great handling...although the E46 is no slouch, either. But the top down factor with the Z4 is hard to beat, especially in the temperate climes of SoFL.
Maintanence-wise, they are both great. DIY oil and general filter changes are no problem. Done the OEM alarm, V1 hard wiring, garage door opener, GPS, Dice/icelink installs without problems...and although I'm handy, I never did any of this stuff before.
Bottom line, I love them both and look foreward to enjoying them for as long as I can. Only problen that I may forsee with the Z4 is that if I keep playing tennis 5-7 days a week, 2-3 hours at a time (I have two hip replacements), I may have trouble getting in and out of the car. But if that day ever comes, I'm sure that I will work something out.
Had mine since May 04 and just had a light connection soldered and headlight washer covers go, oh, and a cd which jumped a bit for a while. Apart from that, servicing has cost me £300 so far. 
south yorkshire