I have the B&O in my M5. It is decent when setup properly (the standard settings leave a lot to be desired) but certainly not what I would call audiophile standard. I like quite a bright sound and feel that the B&O is a little lacking in the highs - no shortage of bass however.
If you can find a car that ticks all the options great, but if not I wouldn't die in a ditch about not having the B&O.
Haven't had any first hand experience with the BavSound HK upgrade so can't help you on that specific question sorry.
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