I current own an e46 M3 and e36 M3 track car with the 3.2 L european engine (S50B32). I previously owned a US spec e36 M3 that I used as my work car.
Completely different cars (US spec e36 M3 vs US spec e46 m3). The 46 is stiffer, more raucous, begs to be revved out, and has a far better interior. The e36 is more fun when going closer to the speed limit.
The S52 feels fast when not pushed, but when you actually try to drive fast it runs out of putt above ~60 mph. There's the effect of torque for you. The aggressive gearing makes it acceptable at low speed, but the car killed me on the highway. I like to cruise at 100+ on long trips, and in the 36 that puts you ~5000rpm... with a redline that comes on before 7. Every trip was constant engine noise.
I don't think either is particularly cheaper to run than the other, they both have their laundry list of issues you need to address. To the poster above, yes, the 46 water pump is more expensive, but you only have to do it half as often as the e36 water pump. Net wash. You can do the steward water pump on the e36, but then you're at e46 water pump pricing.
I think the euro e36 was likely the overall best M3 in it's day. The interior is still... not great (especially the vaders! Worst BMW seat ever?), but you get nearly S54 performance in a lighter package. Plus, its contemporaries were not nearly the cars the e46's contemporaries were. But to me the US spec car feels more like a 332is than an M3. Still a really fun car, just not an M car.
The US spec e36 exhaust note sound worlds better than the e46 exhaust note. Euro spec exhaust note is very similar to the e46, which makes sense given the similar engine.