[uberpanzer]

A locked diff does NOT act like a LSD, period. It is locked, which means that the power is equally split between the left and right wheels and the HAVE to spin at the same rate. If this is a daily car, that's a no-no. For a drifter though, that may work.

Anyway, the M10 powered e21 is NOT a great drift car, but CAN do in a pinch. The M10 does not make much torque, so for drifting work you will have to gut everything you can, put as much weight behind the rear axles as possible, and do every little thing you can to the motor for power (within reason). The e30 is a better choice to start with since you USUALLY can find a decent car as a base that already has a 6 cylinder under the hood. The baby six motors can be swapped into the e21, and they make monsters, but it is not a direct bolt-in to the US spec cars.

I run my 320i at BMW CCA autoX events and have been doing OK, within reason. But for drifting, the e30 is a much better base due to the bigger, more powerful motors and larger aftermarket.