Though this is what I did:

I went to Luthuli, huko chini;

Bought a back to back standard audio jack for 20 bob to 50 bob..

Plugged in the iPod into the "in" jack of the car stereo

On the Remote or  Play Menu - changed source to 

"AUX" or "CD-IN" 

And Voila - iPod playlist !!!

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But thats in a good old Toyota - dont know about BMW stereo, but you could give it a shot !