I have a 1997 E39, 523i, a restricted 525i. It has recently developed bad idling while cold and regularly cuts out. When it heats up it's fine. I cleaned the ICV as posted, change plugs, tested coil packs, etc.. to no avail. I had it put on the diagnostic rig, indicating a cam sensor/O2 sensor fault. I don't want to spend excessive $ on one item if it tuns out to be another. Part are not as cheap in Ireland.

Any help would be appreciated.

cam position sensor would be my bet. I'd also get that 02 sensor fault looked into after you get the idle fixed as that can hurt your fuel economy.