Where is the sensor for the stock guage? Maybe near there?
AFAIK, the sensor and gauge combo on my E39 work just like your E46. I've been told that the vertical position on the gauge means "fully warmed up and not overheating" and is supposed to make you feel everything's okay. Ugh.
And if it starts climbing beyond that, you better be looking at the gauge to see it. I don't know if there's a buzzer/ringer warning, but there's a warning light. Without a warning sound, it would be too easy to miss a light, IMO.
I hate the whole setup and have wondered why BMW couldn't have put a normal linear readout gauge on these cars. I've often thought I'd like to do the same thing you're doing.
I just keep an eye on all the cooling components and ask my mechanic to do the same thing... replacing stuff before it gets old enough to fail is said to be the best way to deal with the situation.
My mechanic recommended putting a 1.2 bar cap on the coolant tank to keep pressure from building up too much because of the plastic components. Trouble free since he did that. I've had the car 10 years with no cooling problems. I think he put that cap on about 8 years ago when he replaced the small rubber hoses on the right side of this drawing.
Maybe
asphaltgambler or
fastfredracing can offer some insight.
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