I have a similar problem with my 335i, low heat. When the car is up to temp all hoses are hot (upper/lower radiator hoses and both hoses to the heater core).
The temp out of the vent gets to about 105 -110f (my 328 gets to 130f)
All the controls work so I hope that the heater core is not clogged. Could this be if both heater core hoses are hot?
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