The e38, like any luxury sedan, depreciates like a rock. Do you need the size of the 7 series? If not, why not take a look at the e39 540? It has the same silky smooth V8 as the 740 and can be had with a 6 speed manual. Similar year and condition 540s and 740s are around the same price (actually the 540 might be more expensive even though it was $20k cheaper when new
). Both can be found in the teens these days. Keep in mind that the 740 was a $70k car when new, so when stuff breaks you're paying for parts on a $70k car.
The sport package includes shadowline trim around the windows, sport seats, the 3-spoke steering wheel, steptronic tranny, sport suspension, and I'm sure some other things I'm forgetting.
Things to look out for: The M62 motor's valve cover gaskets will probably start leaking soon if they haven't already. The radiator will probably give up the ghost between 60k-80k miles, so it would be smart to go ahead and replace it, along with the rest of the cooling system while your'e at it. I think the cats tend to go on these cars, too, but they are covered up to 8 years/80k miles by law. At 59k miles this particular car is coming up on Inspection II (60k mile maintenance) which is a big one. On my old 540/6 I was quoted about $900 by a dealer and $650 by an independent; I'd imagine it's a little more for the 740.
You might be better off finding one with a little more miles on it that's had all the maintenance issues taken care of.