The Z3 came with the 2.3L (160hp), 2.5L (189hp), 2.8L (193hp), and the 3.0L (225hp) shared with the 323, 325, 328, and 330 models respectively. The M Roadster's engine was the 240hp "S52" engine from the E36 M3 until 2001, when it upgraded to the newer 315hp "S54" engine from the E46 M3. The M Roadster also has a bit stiffer suspention.
The 2001+ M roadsters are by far my favorite BMW convertables. I love the styling and the engine. These cars, along with the E46 and the E39s were the high point of BMW styling.