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On the E39 it is a 22 litre "lung" that fools the engine to thinking the exhaust is shorter than it is. This is good for throttle response and initial flow. When it is removed the engine thinks you have lengthened the exhaust by 4-5 feet.
Every try to blow through 2-3 connected plastic straws? There is much more resistance to flow than one straw.
However the V8s sure sound nice when it is removed...
you don't gotta worry about that too much unless you're doing forced induction, i saw a couple of dyno charts, with and without, there is no difference at all.