Hahaha! It wouldn't surprise me if you didn't misunderstand, but the dealer had it wrong... They should make it VERY clear the key needs cutting, or at least do it on arrival.
Anytime I've tried to order key/lock related parts, the dealers I tried were confused or simply trying to sell me the wrong parts - both E39 and E30. (Actually, often for ANY parts they don't understand!)
Paul at Milland sorted it out correctly and cheaper from a German BMW supplier - still genuine parts. The dealer wanted the paint code to order a new (key matched) lock barrel mechanism for our E39, Paul didn't need it and it arrived correct ? The dealer was trying to sell me a handle/latch/lock mechanism complete, instead of just the lock barrel I was requesting ?. They key was also over NZ$100 cheaper from Paul, for the E39 - just needed the remote synched, as normal.