i recently put Callahan drilled/slotted rotors on my e90, came with ceramic pads and brake pad wear sensors. Search for them on ebay... great price, 1yr guarantee, they dont rust (like regular pads do), hard to warp, and callahan advertises they dont squeal either but i put antisqueal on them anyway. While you're at it, i suggest getting stainless steel brake lines too, stops the spongy feel of braking, reduces brake fade, and you will have more confidence in stopping efficiency.
The blue fluid thing isnt necessary... i hear from experts all the time that say completely flushing the brake system is a waste of time as the only moisture build-up is from either lose connections to the calipers or from the master cylinder not being topped off, neither of which occurs in the middle of the hard lines; bleeding the brakes after taking out the old fluid in the MC and replacing with new DOT4 will do just as much good as flushing the whole system... if it make u feel more comfortable to bleed them with colored fluid, go for it. ^__^
I've also been turned away from generic DOT3/4 combo fluids... supposedly the fluid will "mix" itself over time with the existing fluid in order to come to a common viscosity... this mixture can trap and move moisture with it in the process as well as affect the boiling point of the fluid (not typically the case)
sorry for the long reply... just passing info along