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I think the differential only belongs on the full M car, the one that is likely to be used on the track. In the hands of the typical BMW buyer, a locking differential is as much a liability as it is an asset. I know too many amateur drivers who are way too quick to switch off their traction control when they want to have fun in the twisties. In a regular 3 series that's no problem, give it too much gas coming out of a corner and you'll just cook the inside tire, but if you have a locking differential you can get way too sideways if you don't know what you are doing. I've seen plenty of people put their cars into trees, so I understand BMW's unwillingness to put a locking diff in normal production cars.
Another thing, I have no idea where so many of you got the idea that an M car was EVER a focused car, but that was never the idea. They are supposed to be the ultimate incarnation of the series vehicle on which they are based. That means being equally comfortable painting your face with smiles on the race track as they are carrying you and your kids to the grocery store. They are supposed to be a jack of all trades, not a master of any one. The fact that they generally dominate their competition (without sacrificing comfort or any other attribute) is only a testament to BMW's incredible engineers, not proof that they are singular in their purpose.
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