why not an lt1 ? because that is a super heavy, cast iron engine. the ls1 is much lighter so you arent adding a ton of weight to the front of the car.
I'm not saying GM engines are better for the e30. i'm just saying as far as v8's go, the ls1 is better than a BMW v8. the ls1 will have more power right out of the box, the aftermarket support for the ls1 is better than anything BMW has and the ls1 can make more NA power for cheap than a BMW v8 can.