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I've had a car in the 3-series, C-class, A4 range with various performance levels for most of my driving years, and I finally stepped it up to the M550i last month. I grew tired of the lesser build quality, rattles, wind noise, etc in the lower class cars, and the M550i has truly satisfied.
No, it is not as tossable as the smaller cars were and not as twitchy as my C450, but once you engage that engine it propels you into danger territory and just wants to keep going. All the while, its quiet, comfortable, and luxurious. Sometimes its doesn't feel fast until you look at the speedometer. This is the first car I have actually wanted to drive in comfort mode.
If you can afford the M550i over the 340, go for it. You'll be glad you did.
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