lol... well, it's definitely been done before. There are a few pics floating around of V12 E30s, and there's at least one thread on R3V of a guy who is working on a swap. He isn't very far in though.
Also, for interest... this article should be mandatory reading for anyone looking at an M70 for swap: http://bmwe32.masscom.net/sean750/en...0rebuild_1.htm
Long but plenty of good pictures and details.