I also have an E46 (325i) and below is an answer for the question about adaptive drive and how to reset your "adaptive" drive for X5 owners:
As what Kris said the adaptive drive "adapts" to your driving style and therefore shifts in accordance to the daily stop and go pattern you have. In my old X5, since I was exposed to a lot of the Beltway traffic, I end up getting the sluggish shifting in auto mode. It somewhat stays longer in lower gears and then jumps out as if there's a sudden boost. Overall it makes the car sluggish.
In order to reset this, we used to put the ignition key to position 2 (all accessories on except the engine) and floor our gas pedal and hold for 25 seconds (w/o the car running of course). This makes the adaptive drive return to its original factory settings. The result is much smoother shifting and added torque IMO. We've done it to our X5 and a lot of the new 5 and 7 series but I'm not really sure whether the same applies in our E46.
An added tip, my SA in BMW told me that you can also resett the throttle response by turning the key to position 2 for 10 seconds, turn it off for 10 seconds and start the car. I haven't tried it but a lot of my buddies in X5 world swears by it.
I've done it and it seems to work.... I have an 03' X5.