no it's not the neutral safety switch, it's just called a magnet, item # 5 in the link below.
http://www.realoem.com/bmw/showparts...59&hg=25&fg=15
What I did for now was just unpluged it, but now the trans is stuck in limp mode 
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My Garage:
1986 328is (M20 Stroker)
1986 535i (5sp all original)
1990 325iX (Mint 5sp all original)
1989 325iX (Winter auto X car  )
1991 M5
1988 M6
2001 740i (Supercharged)
2004 X5 3.0i (The DD)
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