hi macjules85 - i'll defer to the experts here re: the transmission issue, but it sounds like a rebuild might be in your future. are there any warning lights lit on the dash? might be worth getting an OBD readout at autozone or something to see if anything comes up - there are all kinds of things like O2 sensors, camshaft sensors etc. that will be recorded there, though generally they'll set off the check engine light.
frankly, i think you need to be prepared to sink some money into the car. as you say, BMWs are high maintenance, particularly once they get past 7-8 years and 100k miles or so. hell, my '04 325i is only at 67k miles and i see a couple thousand dollars of maintenance and repairs in my near future. it's not just BMWs of course, most cars require a lot of maintenance as they age... but BMWs are more finely tuned and twitchier than a driving "appliance" like a Honda or Toyota, and the parts and labor are much more expensive as well. i know that doesn't help your situation, but just want to be sure you are mentally prepared - otherwise tbh, you might want to cut your losses on the car. an '00 323i isn't worth very much and it would be silly to pour many thousands into it.