Long post, I know! Read the tl;dr below for a summary.
Lately I've been able to do a bit more work on my car and as someone who is learning a whole lot in the process (no previous mechanical experience at all), it has been very gratifying. I've done the following myself since I got my '87 325E a year ago:
190K - Replaced fuel pump and filter
197K - Valve adjustment
198200 - Front brakes and rotors.
198250 - Tranny and diff fluid.
199000 - Replaced spark plugs. Replaced air filter.
199100 - Replaced O2 sensor.
199800 - Replaced both rear bearings, parking brake shoes, rotors and pads.
Here are the issues I'm facing now:
Clutch: There isn't much left on this. This is fairly important to get replaced in the near future. Also need to replace shifter bushings.
Oil Pan Gasket: My car sat for two and a half weeks recently, and it left quite a large puddle of oil in the driveway. I knew from the beginning that this was leaking but the replacement procedure sounds fairly difficult.
Timing Belt/Water Pump: Timing belt was supposedly replaced at 170K and my car is at 200K. I do live in a dry climate however, and often my car will sit for awhile. Though lately I've been using it for around town driving (unfortunately my commutes are short lately, and not long enough for the engine to warm up fully).
So those are the upcoming maintenance items. Here's other issues I'm not quite sure how to tackle:
Poor Fuel Economy: I get about ~22 in the city with conservative driving. Really though - I am accelerating slowly, I wonder if this has to do with a potentially bad valve adjustment on my part. How can you tell if a valve adjustment is not good?
Engine Temp: When highway driving in summer, especially going up hills, the gauge has on a few occasions hit nearly the red zone. Also while idling, the gauge has a tendency to read high. I have not bled the cooling system yet, but the fan clutch appears to be strong.
Vibrations: When in 2nd gear from 2-2.5K, and 3rd gear from 1.5-2K, it feels like the engine or the drivetrain (I can't tell, feels like the whole car) shakes. Hot or cold - doesn't matter. One thing to note, after I replaced my rear bearings, I jacked up the rear and ran the car in 5th gear. The rear end seemed to make a sort of a grinding noise. I don't notice any excessive noise back there when I'm driving. Should the differential run quietly when jacked up?
The car also shakes when idling on occasion. As for the motor mounts - when I apply throttle, the engine does move about an inch or a bit more when I'm looking at it.
So that's what I'm dealing with. Unfortunately I don't have access to a garage, but I can keep my car covered and have a reasonable space to work.
My question is: Should I just pull out the engine and get the oil pan gasket, clutch, and timing belt done? I'm assuming these jobs are easier to do with the engine out. However - just reading the process of everything involved and looking at videos like these makes the process look very involved and intimidating.
So, for you guys who have plenty of experience, how would you recommend I handle all of these issues? Leave the engine in? Or take it out (with tranny), put it on a stand and work on all of these things? I'm sorry for being vague in my presentation of all these issues - I just want to know what you guys would do if you were in my shoes.
Thanks for reading everyone. Sorry for the length.
Obligatory picture of my baby:

tl;dr - Clutch, oil pan gasket, and the timing belt/water pump should be replaced. I also have other issues like poor fuel economy, engine temp issues, and vibrations under acceleration. Should I take out the engine/tranny, fix those issues above among other projects, or just leave it in? I have very little mechanical experience.
Lately I've been able to do a bit more work on my car and as someone who is learning a whole lot in the process (no previous mechanical experience at all), it has been very gratifying. I've done the following myself since I got my '87 325E a year ago:
190K - Replaced fuel pump and filter
197K - Valve adjustment
198200 - Front brakes and rotors.
198250 - Tranny and diff fluid.
199000 - Replaced spark plugs. Replaced air filter.
199100 - Replaced O2 sensor.
199800 - Replaced both rear bearings, parking brake shoes, rotors and pads.
Here are the issues I'm facing now:
Clutch: There isn't much left on this. This is fairly important to get replaced in the near future. Also need to replace shifter bushings.
Oil Pan Gasket: My car sat for two and a half weeks recently, and it left quite a large puddle of oil in the driveway. I knew from the beginning that this was leaking but the replacement procedure sounds fairly difficult.
Timing Belt/Water Pump: Timing belt was supposedly replaced at 170K and my car is at 200K. I do live in a dry climate however, and often my car will sit for awhile. Though lately I've been using it for around town driving (unfortunately my commutes are short lately, and not long enough for the engine to warm up fully).
So those are the upcoming maintenance items. Here's other issues I'm not quite sure how to tackle:
Poor Fuel Economy: I get about ~22 in the city with conservative driving. Really though - I am accelerating slowly, I wonder if this has to do with a potentially bad valve adjustment on my part. How can you tell if a valve adjustment is not good?
Engine Temp: When highway driving in summer, especially going up hills, the gauge has on a few occasions hit nearly the red zone. Also while idling, the gauge has a tendency to read high. I have not bled the cooling system yet, but the fan clutch appears to be strong.
Vibrations: When in 2nd gear from 2-2.5K, and 3rd gear from 1.5-2K, it feels like the engine or the drivetrain (I can't tell, feels like the whole car) shakes. Hot or cold - doesn't matter. One thing to note, after I replaced my rear bearings, I jacked up the rear and ran the car in 5th gear. The rear end seemed to make a sort of a grinding noise. I don't notice any excessive noise back there when I'm driving. Should the differential run quietly when jacked up?
The car also shakes when idling on occasion. As for the motor mounts - when I apply throttle, the engine does move about an inch or a bit more when I'm looking at it.
So that's what I'm dealing with. Unfortunately I don't have access to a garage, but I can keep my car covered and have a reasonable space to work.
My question is: Should I just pull out the engine and get the oil pan gasket, clutch, and timing belt done? I'm assuming these jobs are easier to do with the engine out. However - just reading the process of everything involved and looking at videos like these makes the process look very involved and intimidating.
So, for you guys who have plenty of experience, how would you recommend I handle all of these issues? Leave the engine in? Or take it out (with tranny), put it on a stand and work on all of these things? I'm sorry for being vague in my presentation of all these issues - I just want to know what you guys would do if you were in my shoes.
Thanks for reading everyone. Sorry for the length.
Obligatory picture of my baby:

tl;dr - Clutch, oil pan gasket, and the timing belt/water pump should be replaced. I also have other issues like poor fuel economy, engine temp issues, and vibrations under acceleration. Should I take out the engine/tranny, fix those issues above among other projects, or just leave it in? I have very little mechanical experience.
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