[TheBreeze]

The BMW PS would replace the items that make up the sport suspension, so if you don't care about the other items that are part of the sport package, it would make sense to simply skip the sport package. Note: I'm not sure if the ZSP adds bigger/better brakes or not, so that is something for you to research. A full brake upgrade would be expensive on it's own - far more than what the ZSP costs.

Also, be aware that while the BMWPS does address the under-damped shocks/struts, it doesn't address the weakest links in the 1er suspension - the soft hollow bushings that make the car so downright squirrelly. If you want a really tight handling 128, you should consider installing the M pieces as well. The BMWPS for the 128 does include a rear sway bar, which would mean the rear subframe would need to be dropped in order to install it. While they are in there, I would recommend adding the M rear bushings. The other M pieces are pretty simple bolt-ins, so you could do those at any time later. (Note that while installing the front control arms is very easy, the car would need to be aligned afterwards. Something to consider if you only want to pay for an alignment once.)

Point taken on the wheels. On a 128, I'd go with a square 18 set-up, probably 225 Michelin PSSs on 18x8.5/45 all around. Should be plenty of tire for the modest power of the 128, plus you'd reduce understeer, you'd be able to rotate, and there would be no danger of rubbing.