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I would get the Non CPO M5 and here is why:
42k vs 28k, the difference is 14k miles, and if this is going to be a car that you drive daily, expect to put on at least 10k per year. That CPO warrantee lasts for 8 more months, and the car costs more with less options. I would buy an aftermarket warrantee and call it a day.
Keep the black leather. Red is sexy and all, but I agree with you on aftermarket upholstery. Unless you purchase full seats from another M5 and refit them into yours (not worth it).
Most of the time, BMW will CPO a car with either their own warrantee, or a third party that sides with BMW. Ive had at least 4 offers to warrantee my 07 335xi with 66k miles with bmw encinitas.
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