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Firstly, you don't really need more hp to have fun on the track, or even to practice drifting. 300 is plenty to begin with. The limiting factors in having fun here are the tires, suspension, brakes, engine cooling and sound. Those are what will actually keep you from having fun. Not lack of hp.
But since you probably wont believe this, do remember you need to tune the DCT for increased engine torque as well. Otherwise it might slip under load causing premature clutch wear. Piggies such as the JB4 do not offer this sort of tuning, but you may still want the JB4 just to run water mist or meth injection on the side.
BTW I never experienced limp mode (neither engine nor DCT) with my tuned Z4. I went drifting together with an older C63 AMG a few months back, and since that car decided to overheat and spill coolant and mine didn't, I conclude things could be worse. That being said I keep a constant eye on the temp gauge, and my buddy's N55 is definitely superior in this department. It is fair to say the cooling system is not track ready out of the box, and if you spend a lot of time near the red-line you will probably miss the dedicated DCT oil cooler of the E9x M as well.
So for tracking, I support the idea of installing the aux water cooler. Additionally I would look into ways of tricking the outside temp sensor to activate the "get to work"-mode of the cooling system. I imagine installing a switch with a component that increases or lowers the impedance of the temp sensor equal to +20C somehow. Because I have noticed that when the outside temperature gets near 40C/+100F here in China, the oil temp drops to a stable 100C instead of 120C where it normally sits. It basically causes the ecu to skip economy mode, letting the fan come on earlier etc. A bit like activating sport+ in an M4. Anyway, it is just an idea...
As for exhaust sound the cheapest solution, that does not cause error codes, is installing cat-less mid-pipes and high-flow race cats up front. You will also find that the left OEM muffler mutes the sound more than the right muffler, and I guess this is where the difference between the 35i and 35is lies. The 35is probably has less damping material inside the left muffler, creating a more balanced/less 3 cylinder-ish sound. As soon as you go completely cat-less or worse, you will most likely start annoying your neighbors and even yourself while just cruising at highway speeds. Also there is a reason BMW uses active exhaust flaps, even with their M cars, and you would most likely want to keep that feature. On mine, although the flap is closed on cold starts, the start up sound actually causes car alarms to go of in the parking basement where I live (I just did mid-cat delete).
Oh and I almost forgot. You can also do throttle and engine response tuning. AFAIK COBB does throttle map tuning and ESS does engine response tuning. Personally I don't like the nonlinear throttle map of the Z4, especially in sport+ mode, but I love the improved engine responsiveness of the ESS tune. It basically means that the car feels more awake (not to be confused with sport+ mode where the car just feels like it has more hp in an uncontrolled way). And since the N54 does not have valvetronic, it benefits from the extra does of caffeine that engine response tuning yields. And since you probably have cruise control for high ways, the only time you will miss the lazier engine response is during stop and go traffic jams.
For suspension and tire (pressure) tuning check out the other threads on using M suspension components.
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