Ok... this morning I checked that little red float thing. No you can not pull it out of the res. You CAN move it up and down - and a little bit side to side.
So... it is just as I thought... you don't really need to over analize that diagram bmw puts on the res. Just know that when the float stick is BELLOW the cap threads... you will need to add some coolant mix. But if it is that low your YELLOW add coolant light will come on anyways.