Matt,
I am sure you will like the BMer, at least as well as your 400E. That was one of the cars I considered in 1994 when I bought the 540i. I had owned a 300E previously, and decided to try a BMW, as I had never owned one, and loved the sporting feel of the car, as opposed to the more sedate luxury of the MB.. still very happy with my choice, as I said earlier.
No real problems concerning the 17" wheels & tires, the upgrade to the handling was very noticeable, with no real comfort sacrifice that I can discern.. I bought tires & wheels over the internet already mounted & balanced, delivered to my door with a bolt & lock kit, etc.. everything included, from Discount Tire. Put them on myself, and sold my 15" 4 to a local 528 owner as an "upgrade".
Make sure if you change wheels that the lug bolts are provided if different from std, as they generraly are I think...