If you are looking for a streetable race car that is comfortable, safe, and built really well, go with an M3.
If you are looking for a daily driver that can run with an M3, but are sensitive to having a car that is not ostentatious, not a fuel guzzler, and not punishing to the wallet, the 335d shines.
The reason many M3 drivers feel they need to defend themselves is how close a 335d comes to an M3 at 2/3 of the price, while beating it in several key categories such as low end torque and fuel economy.
The nice thing about BMW making both is that the two cars are made for different markets and different folks appreciate them. The sad thing is that both diesel and gasoline technologies have their own strengths and limitations, making the comparison rather like one of apples and oranges.