http://www.e90post.com/forums/showthread.php?t=641323
The reason for recoding is to get rid of the Eq curve that comes with the base radio setup.(this is also done with a flattening processor like a cleansweep ) The details are in the above thread. Some do this with a processor but some try to take the load of the processor by recoding to Hi Fi which gives a flatter output from the Head Unit. If you don't want to use a processor at all just an amp then recoding to Hi Fi does the trick.
A lot of people like traditional stereo and regard the rear speakers as a waste so do not modify . If you like surround sound your opinion may differ but your ears don't point to the rear.
There is a list of speakers that fit and are commonly used
in the above link. You should study that link until you understand exactly what your possibility's are.
http://www.e90post.com/forums/showthread.php?t=343673