I am in Oz, so not sure of legality, but the e36 does have a sharp cut off for low beam and electric adjustment. I would never go back to halogens. I also have H1 HID for highs, but do find they are not that good for flicking on an off as they take about 5 seconds to fully warm up. So buy some good halogens for the highs - when you look for them, forget about claims for brightest etc, colour temperature is what you want to know. The 6000K are the closest to daylight and will give an intense white light, with a tinge of blue.
Look internationally and you will find them - http://cgi.ebay.com/ebaymotors/PIAA-...Q5fAccessories
For fogs, you can go past a good set of H1 halogens with 3000K (yellow) colour temp.
Post up some pics when you have finished.