Hi Paul, well I have just completed the chassis repair on my e46m3, with your post and countless hours spent googling options I finally got into it and the whole project went extremely well.
Standard procedure was followed to strip and prep area for repair, I did opt to fully weld stiffening plates to all 4 areas in question, the initial crack was about 40 mm long on front RH mount, this being typical failure point but my car also had slight deformation of the folded sheet metal tub that the sub frame actually bolts to, it does show just how much torsional up load this area is subjected to.
So with the areas prepped, new plates made I fully welded these in place taking care not to over heat the entire area. The repair was pretty straight forward and the result was very Profesional, zinc based chassis repair paint was used to seal and protect the exposed bare metal (two coats) then full under body seal was applied, with car all back together you would have to be an expert on this type of repair to spot it.
Rear muffler was also cut open removing the packing material as you did, ummmm not a lot of difference to be honest...almost not worth the effort however looking at removing the cats now.
Another mod was to machine up some poly board plastic spacers to stop side trust on front bushes ( these I also replaced along with all bushes ossiciated with the sub frame) these mounts are bolted up just In front of the rear wheel arch, huge improvement under heavy load gear changes, stops that little side ways kick and keeps car in straight line.
Last thing was to apply the BMW structural foam as per TIS recommendations along with the extra areas that you also filled.
Also replaced all brake pads to race spec, wow these make it stop.
Thank you for all you help Paul it was very much appreciated.