Hello All,
The 525i (95, 158K miles) had the CEL on 4 months ago, with a O2 sensor code. I got the sensor replaced by the dealer.
I now have the weirdest issue, the CEL is constantly on with the same code (1221) O2 sensor. The dealer says that its probably something to do with the computer and would cost around $1200 to fix. ( I had an alternator changed before and he says it could have a sent a voltage surge).

Anyway what I now notice is that CEL turns off and on, and when it is on there is no problem (I get 22 mpg, city) but when it is off the rpm meter starts oscillating and the car stalls after sometime. When i restart the CEL is on and the car runs fine.

Any clue whats happening here? Anyone had any similar problems with their car?

Thanks in Advance.