e30 Odometer reads way too high - HELP

Hi, I have an '89 325is which has had an s50 engine swap (from a '95 M3). The previous owner did the swap.

When on the freeway and passing mile markers, I noticed the odometer was reading many more miles than I was actually driving. So I set my GPS to display speed and miles, and found this:

Odometer shows 10 miles driven
GPS shows 6.3 miles actually driven

I have searched for hours trying to find information on how the odometer could read that much too high. One thing I noticed is that one kilometer equals 0.62 miles, which is just about equal to the error in my odometer -- that is, I wonder if the odometer is reading in kilometers?

Does anyone have an idea how I can get the odometer to read correctly? I have no clue if the odometer problem is a result of something done electrically during the engine swap, of if the problem is the result of some other cause.

Thanks....

Stock tires? Original diff?

Im totally unsure.. But i know there's a few different gears for the VDO dash...

It could be eazyer to re gear the odometer then change wheels and stuff... finding the right ratio is the hard part

The odometer reading is independent of the engine. The sensor in the differential goes right to the dash, if it's reading wrong, then as mentioned, you either have the kilometer gear in your guage cluster, or your tires are that much shorter than stock. Have you clocked it to another car, or through one of those signs to see if the speedometer is accurate? I had 195/60 14 tires on mine and it came with 185/60 14, my speedometer would be off about 3mph at 30mph (or about 10%), yours seems a little more extreme, though.

The speedometer is off a little, but not too bad -- at a reading of 65, I am actually going 60. The odometer however (as I mentioned above) is super far off -- tonight I ran up 43.7 miles on the odometer, and the GPS said I actually went 26.5 miles (the GPS is right on, as I have made that same trip many times in other vehicles).

LordOfTheWaters, my tires are a bit bigger in diameter than stock, but not huge. The differential ratio shouldn't make a difference as (the way I understand it) the speedometer and odometer get their input from the differential's ring gear which is turning at rear axle speed.

My speedometer, near the odometer, says "Miles"... but I am wondering if somebody installed metric ratio drive gears in the odometer. However, I can't imagine how that could happen. I don't know enough about the coding plug to know if an incorrect one could cause the odometer problem I am having... and if so I don't know why it wouldn't also affect the speedometer.