The stereos in the E39 are the worst!! BMW doesn't want you to do 2 things:
(1) Drink anything while driving (crappy cup holders / spillers)
(2) Enjoy music
I kept the factory system, but added a Bass-link sub by Infinity. It added enough bass for me, and made a 80% improvement. Also, the sub fits nicely in the hinged cubby on the right side. This way I don't loose any trunk space.