One of the most talented people on this board just got done converting his automatic
E-32 to a 5 speed. The conversion between the E-32 and E-34 is virtually identical.
His name is Don Gale and his attention to detail is second to none...he has few peers...very talented.
One of the best resources you will have for this job is his website:
http://www.nmia.com/~dgnrg/page_41.htm
At some point I may too take this on but it is on my long and not short list of things to do.
As to interchangeability between the 525 and your car...a manual trans from a 525i will not bolt to a M-30/535i car...different bellhousing.
Good Luck,
George