The point of this car is to bring
new customers, not to keep current BMW customers. Yeah they may laugh at you but they would be likely leasing -not buying- and would not be caught dead in a 323 to save a few dollars/month! You can't be passionate about performance if you'd buy a 323 so it's back to the logo thing again. They are much better buys for the money out there and I would take a MazdaSpeed over the 323 anytime, without hesitation. I would also seriously consider a used 330 over the 323 so I am not anti-BMW. But I want value for my money.
Some people have an issue with used vehicles, so let me preface this by saying I'm working in a realm of new vehicles only. If I hear this poseur/not perfomance/non-enthusiast crap again I'm going to scream. That 323 (with a sports pkg and a manual) will eat a lot of other "sport sedans" for breakfast on handling and braking. And it is hardly slow! If I hear one more got to be over 200HP to be a sports car my head will explode. This is the same thinking that calls the Miata a chick car.
Maybe you care about HP/Tq and that's fine, your personal preference is exactly that (and a lot of people share your preference no doubt). But quit calling a car names because it doesn't meet your definition of a sports car. I could argue anything less than a C6 is not a sports car and we'd run in circles.
I would take this 323 over a TSX or other price compeitive sedans any day. I almost bought a new 320i instead of my current 328i because the handling and braking was superb. In the end I bought my 328i because I got an unbelieveable deal.
Who does the 323 appeal to? Again assuming you can't buy a used 325/330 (which is what I'd do), this appeals to people who have a $40k ish budget, want RWD and sporty driving feel, with an entry level luxury environment. Sure, some will buy it for the badge, but you can't tell me most C6 buyers don't buy that car because it looks good and is a 'vette (nothing to do with being the best bang for the buck sports car made).
Ugh, have people even driven one of these?!?

(I need a smiley pulling it's hair out)
Agree with you there brother!!, My 2005 320i is more than enough to get me by.Specially for a sedan that drives ah well...perfect along with the handling...breaking etc.etc??? Yes im sold and as for a newbie???Well yes too!!.Next on my list will be an M3 .(for those die hards that are fuzzy with HP/TQ) this will be discuss.But for a sedan that will offer you a sporty/responsive dynamics....3 series 320i aint a bad deal comparing to the '06 model out in some other country??? ...the '05 320i in CANADA still has more horses/tq than the 320i/320d in UK/Europe/Asia/Australia..even the new '06 323/USA..Thats is why im still happy.
2005 320i CanSpec in Steel Blue:

Cheers!!