This install was easy, there is
no need to remove the bumper skin 
.
You will need Curt Hitch 11771 which is (currently) only listed for a 2006 E91 325xi. I guessed it would fit a RWD 328i and it did
Today the best deal for the hitch is $179 from
http://www.etrailer.com/
This is how it looks when installed:
Installation is very simple:
. the bumper skin DOES NOT need to be removed
. undo the screw underneath of the bumper skin using an 8mm spanner
. remove a few plastic pieces under the car
. unbolt the bumper in two places using an 18mm spanner (behind the skin)
. put spacers on the bumper bolts (4 washer for each bolt)
. lift the hitch into place
. bolt the bumper and hitch (need an 18mm spanner and this is a little awkward, but once you figure it out it it easy)
. attach the hitch to the A-Frame
. double check all bolts are tight
. re-affix all the plastics bits and bumper skin. You will have to use a dremel on the piece of plastic that the bumper skin attached too (see picture below) -
use safety specs in case (when) the dremel blade shatters
- Oh try not bang your nose on the hitch when underneath - I did that twice and it smarts
You won't need them, but
click here for a raw dump of the photos.
Also the official installation instructions are attached - they are even more brief than mine
Also here are the towing specs from a UK manual:
