Most here agree the Head Unit only power sucks.
And the Hi Fi system is pretty mediocre at best.
The upgrade path for speakers amps and processors is pretty
well documented in the following thread. You don't have to change
the head unit but you should program it to Hi Fi output if you can
for clean balanced pre amp signals for whatever amps you decide on.
Only having a CD to play music does kind of suck to though.
I went and bought and aftermarket head unit for my old Integra
it has USB ,CD, Bluetooth , HD radio , Pandora , A2DP music streaming,
ipod compatibility , Bluetooth, phone and it was 400 bucks.
I was surprized
that A2DP doesn't sound that bad . The point is you get
a whole lot of technology for not much money something BMW would
charge you thousands for.