definitely the M3.
doesnt matter who has more power, or grip or looks..etc. the m3 still gives the driver the most rewarding driving experience currently. It's rivals are catching up for sure, but they're not there just yet.
That's if that's your sole barometer. All else considered, it is an entirely different issue.
Even "a rewarding driving experience" may mean different things to different people.
Besides, people who shell out north of 50 thousand pounds would want more than just the best drive. Especially if it isn't head and shoulders above its rivals (like it used to be). Looks, for example, is a very important factor that is taken into consideration. Yes it is entirely subjective, but I can see why people might go for the Merc or Lexus (even Audi if they are still selling it).
Also, performance saloons like these, no longer just appeal to the driving enthusiasts like they used to. And there's acknowledgment of this fact by the manufacturers (BMW included) themselves, by making their performance saloons more and more appealing to mainstream buyers. Because of that, how well it drives probably isn't the overwhelming factor anymore. Unless, like I said, it is head and shoulders above everything else, which it isn't anymore.
EDIT: I just realised that you may be stating your own justification for your preference of the M3. If that is the case I beg your pardon for the improper post.