I think its two things, looks and feel. the e34 is a perfect blend between the boxy old volvo-looking bimmers from the 80's and todays newer sleek 'isthatahondaaccord?' bimmersIMHO of course. i'm sure lots of people here love the newer bimmers and their sleak lines and whatnot. I can see beauty in both, but the e34 is definatly the best.
The second reason is ride and feel. The e34 is rock solid and handles great despite the silky smoothness of it all and its 3500lb weight. as i've heard it the newer modles and the older models just don't have this feel. i mean.. honestly, everyone and their damn dog has a new 3 series now. we might all have 7's except they're even more expensive, more expensive to maintain, and, for me, wayyy to big.