OK, I just did this on my 2000 323I with a build month of May 2000 and 85K miles. All of the information and insights from this and other forums/web sites was very helpful. I don't normally work on my cars, but I really don't like to pay the $160/hr. BMW shop fee here in South Florida so I've become a DIYer for PM. I did run into one major issue that I will discuss in item 5 below. Here are some things I ran into and how I overcame them as a novice. I'm sure many of you will and can do better.
1) My filter has only one inlet and outlet so that made it a bit easier than those with multiple hoses. I do not know if mine had been changed before, but the one that was there was a Bosch. I replaced it with a Wicks(sp) filter I bought at the local parts store. Maybe not the best, but I'll be changing it again in 15,000 miles so I'll put a Bosch on then.
2) The filter was further into the center of the car than what I had imagined from the info I'd read. Even the Bentley manual did not give a good description of the location. It is about 1.5 feet in from the left edge of the car, slightly aft of the forward jack point on the left side under the driver. I took the protective shield completely off as it didn't look like it would bend without breaking. Be advised that on my car there was a protective shield over something that is very close to the left underside of the car. This is not the fuel filter.
3) I purchased some replacement hose clamps (2) at the local BMW dealership ($1.73/ea), but I did not replace the hose sections. Everything looked very good and very clean before I got started. It was not a problem at all to loosen or tighten the hose clamps using a flat-head screwdriver. Getting the bracket off was quite easy as well. I found that turning the filter made it easier to get it off the hoses.
4) Even though I had pulled the circuit breaker for the fuel pump (#54) and turned the engine over as much as possible there was still a fair amount of residual pressure in the line. DO NOT forget to wear eye protection and have kitty litter ready to put down to collect fuel. I had my pan to collect the fuel, but the pressure did spray it around a bit. Once the fuel started coming out in a stream I left everything in place (filter still partially inserted in to the hoses) and let the fuel and pressure bleed off. While I was waiting I remembered I hadn't opened the gas cap so I did that, but I don't know if it made any difference. Once the fuel was just dripping out I then completely removed the hoses. This caused a very short burst of air and fuel to come out, but it wasn't much. All in all I got maybe two or three cups of fuel on the ground and in the catch pan. I got more out of the filter once I had it off and in a bucket. That fuel was dirty and had shiny specs of something floating in it. The dirty fuel came from the input side.
5) Installing the filter and hose clamps was easy and as I said I was able to use a flat-head screwdriver to tighten the clamps. The real problem arose while trying to get the filter bracket back around the new filter and onto the car. The old and new filters have a hard rubber "sleeve" around the middle where the bracket and car body is going to touch it. I assume this is to protect the filter from rubbing against the bracket and the underside of the car. The new "sleeve" isn't pliable so the bracket would not easily wrap around the filter and onto the threaded post on the bottom of the car.
To make a long story short I wasn't able to get enough force on the bracket to put it over the threaded post let alone keep it in place long enough for me to get the nut on. I did get it on once, but as soon as I released pressure it slid back down the post. This made me nervous, as I didn't want to strip the threads. After a very frustrating hour or so I decided I had to do something similar to what I'd done to get my disposal in place under my sink - I used the floor jack to push the filter up and keep it in place while I put the nut on. (My car was on jacks in the front.) I placed a piece of wood on the floor jack and positioned it so the wood only pushed up on the filter and bracket and not the car. It's amazing what a little leverage will do! This worked well and in no time I had the bracket securely in place.
The rest of the process was as others have described. Based on the fuel I got out of the output side I'd say it was doing its job. Thus, I probably didn't need to change it, but it was a good experience none-the-less. It may be just wishful thinking, but I sensed smoother and more responsive acceleration after changing the filter. I hope this posting helps someone even if it was a bit long winded.