With LPG you don't even need to flip the switch if you run out of gas, it will change over for you.
I have seen 1999 328 sports with less than 100k on the clock for around the £3k mark. There doesn't seam to be much of a market for larger engined cars now.
As for tuning the 328's, I would forget about the exhaust and replace the inlet manifold for the one off the M50. It's meant to be good for another 10-20bhp.
As for mileage I prefer the high mileage BMW's! At least that way you tend to get cars that have been used and looked after. I'd much rather have a car used daily for lots of motorway miles that is serviced regularly than a low miler driven 2 miles a day with the engine never getting up to temp and serviced once a year! You also have a better chance of buying a car that has not been clocked.
I used to buy low mileage cars but after I converted to BMW I actively try to buy cars that have done over 120k as they have already depreicated quite a lot meaning I can pick them up and do whatever mileage I want in it. Mine is a 1998 328 sport that has done over 140k. My dad's 1999 323 has done over 180k. Both don't use a drop of oil.