Hi Melvin,
A fellow 4-cylinder owner here. I have looked into tuning options for the N42 engine. It seems that tuning options are slim, unless you want to rebuild with different engine parts, and it is said that such changes may be better for racing than daily use.
A guy on a Danish FB E46 page claimed that the N42 was 'easy' to tune with parts like pistons and cams from a Saab, I believe. If I can find his post I will share it.
I found these two links:
We review N42 tuning and highlight the ultimate modifications for your car. BMW N42 are good project engines and with the right performance enhancements like ECU maps, turbo improvements and camshafts you will really maximize your driving opportunities.
www.torquecars.com
We review and look into N42 tuning and report on the greatest modifications. BMW N42 are good project engines and with the right motorsport parts like remaps, turbo kits and camshafts you will substantially maximise your cars bhp and torque.
www.cartuningtips.com
For my own car I have considered getting an ECU tuning. A Danish company advertises decent power gains using this method. But essential repairs always eat up the tuning budget.
Schmiedmann has a large selection of various tuning parts, maybe you can find what you need there:
BMW E46 Sedan 316i N42 - Tuning og optimering - Schmiedmann - Nye dele
www.schmiedmann.dk
Last note, this forum is mostly populated by US users, none of whom own the 4-cylinder models. You may have better luck getting N42 specific advice on a UK/EU based forum.
Let's know if you find a way to get some more power to your wheels. DIYs with photos are much appreciated.