Thanks for all the input. I didn't include the Acura because to get a stick you have to get a two-door, and in a car that size I'd prefer to have 4. Plus, it's FWD, and the G35 and RX-8 (probably) will both offer similar performance for a similar value.
The VR6 is a good thought, but in truth I've driven the GTI 1.8T and don't mind the four. It's lighter than the VR6, and the turbo lag is surprisingly mild. The VR6 is quite a bit more expensive, and just doesn't seem worth it. On the other hand, the tires/chassis of the GTI do suck; a far cry from my old A2 GTI.
Reliability is another concern, but there's little chance I'll have this car more than three years (and I'll probably lease), so as long as it's not in the shop every day, I don't so much care if the engine grenades at 100K miles.
Finally, with respect to the C Coupe, I drove one at the Power Trip and was really not impressed. On paper, it looks great, but in person it feels cheap (and rattly) and has the Mercedes trademark numbness. The GTI is a superior choice, IMHO, even with FWD.
The other option that I didn't include is the V8 S4, which is substantially more expensive than any of the above but that may be worth it.
I'm thinking what I'll do is nothing now, and wait for the RX-8 to hit the streets. That design has a lot of potential, and it's hard to argue with the price point. In the meantime, I'll keep my eyes open for good M3/4s, and if I find one of those, maybe I'll pick it up.
Since you're used to the BMW's smoothness, the 1.8T engines will probably come as a big disappointment. Having owned an Audi 1.8T in the past, I was never thrilled with it's performance, especially in hotter weather. The turbo lag just plain sucks. The VW 1.8T has the same engine - you could chip either car, thats true. But there are downsides to doing this such as voiding the warranty, and reliability of the turbo becomes a big question. And you're still stuck with the turbo lag.
But if you like 4-bangers and turbo's, etc - Have you considered the Benz C Coupe?
Supercharged 4 cyclinder, rated at 190hp. Seems like a fun car, and starts around 25,000. Can get pricey with options, but you can pick and choose. MB has a car config website, and there are extensive options for this car.
Otherwise, I think the GTI VR6 is a really fun car. The VR6 engine is potent, but the suspension needs work. On the flip side, for commuting, the suspension would be a lot more comfortable. The GTI VR6 also comes loaded with all the toys. I though I heard that it will soon be offered at 200hp. But I'm not sure. I'd still take the 174hp 6 over the 1.8T anyday - smoother and more torque. (Rumor has it that in 2004, VW will offer the GTI with AWD and the W8 engine. Now that will be interesting!)
I would also consider the Acura CL, type S with the 6 tranny. Again, a lot of bang for the buck, more comfort than sport, and RELIABILITY if you're going to do a lot of commuting miles.