I lost reverse in my 540iA M-Sport a few months ago and in looking into what the problem was and found that these trannies have 2 common problems.
First one is the retaining clip on the reverse clutch packs breaks off the housing, and then the reverse clutch pack is no longer held together causing complete loss of reverse. (what happened to mine)
The second common problem is related to the valve body. Specifically the check ball in one of the fluid passages. The check ball gets worn down over time and gets sucked past the point where it's supposed to stop. The symptoms of this problem sound most like what you're experiencing. So your problem will most likely be gone with the valve body rebuild.
Cosmos Black/Black 1995 540iA M-Sport
BMW Individual Exclusive Edition, 1 of 65 total, 9/25/95 Build