dssur
+1y
all you need is a chip. I had an 86 eta. the 84-87 325 "no e, no i", which means there is no letter after the 325, is the eta series engine with low redline and long stroke (lots of torque). The chip will raise the redline right off the tach, watch your friends faces as you rev clean past the numbers, its great.
a good mod after that is to replace the 2:73 rear gear with a 3:07 or 3:23 from certain e28 (84-88 533i-535i) cars.
Bang for the buck, that is all you will need. If you really want crazy power though, you can get a euro 323i cylinder head (it has 7 cam journals and a more agressive cam) and computer and you will have a 7k rpm stroker that will smoke most pony and camaro dreamers. Those are hard to find though.
the 325i cylinder head wont work, the 325i has hemispherical combustion chambers and pop top pistons.
But really though, the 50 dollar ebay chips are your best value, the car will be an animal after you swap it. Do your homework first though, there are two different types of chips and three different ecus. You have to get the ecu number right AND count the number of pins on the chip. Some ecus have a soldered in chip, which can make you sad. But it adds like 27 hp and 50 lb ft, you will be VERY happy.
Cone filters are a waste of money. spend the money on opening up the exhaust and maybe a rear gear swap.