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Best way to know if it's the Hood Sensor. When it isn't plugged in, the alarm believes the hood is closed. I replaced mine earlier this year for this same reason. It's just another common E46 failure prone part. Not an expensive part to replace either.Or just unplug it.

Amazon.com: Artudatech 61319119052 Alarm System Switch for BMW E46 E53 E60 E82 Mini Cooper R61 R60 R52 : Everything Else
Amazon.com: Artudatech 61319119052 Alarm System Switch for BMW E46 E53 E60 E82 Mini Cooper R61 R60 R52 : Everything Else
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