Is there an official vehicle service history that shows that both Inspection I and Inspection II were done? Surprisingly, the air filter is only specified to be changed at Inspection II, but I just changed mine as part of Inspection I. It wasn't even close to being as dirty as yours.
The microfilter is the cabin air filter, and should also be replaced at least during Inspection I and Inspection II.
More importantly, Inspection I and Inspection II also call for a valve adjustment. Inspection II also calls for replacement of the transmission fluid, differential oil, and spark plugs. The brake fluid should also be flushed every two years.
Do a search here for "2007 Z4 Service Maintenance Checklist".
Mine: 2006 Z4 Roadster (E85) | Interlagos Blue Metallic | Black Extended Nappa Leather | Carbon Leather Trim | Purchased 7/19/12
Hers: 2011 335is Coupe (E92) | Le Mans Blue Metallic | Black Dakota Leather | Dark Glacier Aluminum | 6MT | ED 5/12/11
Also Mine: (On Order) 2016 M4 (F82) | Sakhir Orange Metallic | Black Full Merino Leather | CF Trim | DCT | Adaptive M Suspension | 19" Black Alloy Wheels | ZEC | ZLP | ZDB | ED 5/13/16