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In Sports mode and under full, or nearly full, throttle, I would describe the shifting as harsh or jerking. I believe this is completely normal. Of course I have not driven your car, so what do I know? You could try and arrange a ride in another X4 M40i - I'd bet it behaves the same way.
 

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I noticed my M40i when in sport+ mode auto trans mode, if i drop the hammer and then let off throttle after it shifts down its almost like its a super sensitive pedal for a bit which presents as the transmission engaging /disengaging. As far as how mine operates, in comfort mode the car is fairly smooth shift wise but you can definitely feel it shifting. In sport/sport+ mode it is much more aggressive on the shifts and definitely jerks the car slightly. I believe this is all normal operation, no indicator lights, no funny smells, no leaks.
 
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