Nice thread South!
You could beleave it or not ... the most logical engine decision is the 3.3ltr. V6 derivate of the S63 ... only because of its mayor advantages ... its the lightest, shortest and most compact engine alternative ... together with some cost effective lightweight body panel its the best way to make the F3x M3 the far best sports car in its class.
Second best engine decision was an modified S65 ... because this engine was one of the best (if not the best) the M-GmbH has developed ever. The engine has many fans in the M-GmbH and was an pure M baby. The engine was also light, very robust and also compact for an V8.
Only third for the from all 335i fans favored N54/55 (S54/55) ... because its neither an compact fit nor its possible to bring this engine to 450+PS without more displacement and make the engine stronger (increasing weight) ... but the main reason is that the M-GmbH just making an chance in an more traditionel direction, this meen more unique engines and more lightweight issues ... and finding the perfect way between cost reduction and performence/"the spirit of M" ... and the N54/55 engine choice was one of the cost reduction over all times.
I think the S63 is simple too big to be an nice fit for an F3x ... look athe the manhart E92 and its ultra large hood to fit the engine ... and I think the F3x would have an overall flatter front end ... so how this engine should fit in an proper way?
... the 1M was an nice little car and as good as the M3 ... but wait for the M3 EVO
(and the 2012 M3CSL?), this would bring the "old" E9x M3 over all of his compeditors again .. also over the 1M.
The really Supertrackcar would be the F2x 1M with real lightweight parts and an light and ultra compact R4 BiTurbo engine with 300+HP.