I had noticed a few electrical gremlins since fitting the modern stereo and have finally figured out the slight wiring difference between the 316 and the 320, the latter of which is shown in the E21 Wiring Diagrams available on the internet [download here]. Thought I'd throw up an updated diagram of how the wiring can be correctly adapted in the base model E21s.
Basically if the car had a stereo available as an option, which only the higher models did, then the two power wires necessary for a modern stereo are present. On base models [315, 316, 318], only a single aux. power wire is present. It can be made to run a stereo head-unit, but there are problems so if you're thinking of doing this it's worth reading my failsafe guide.
As in the diagram above, a modern radio/CD-player type head-unit will most likely require two power sources. A red wire connected directly to the battery that supplies a small amount of power to save settings and CD positions, and a yellow wire connected to the ignition switch that tells it to only turn on when the car is fired up. *Connecting both wires straight to the battery is an option so the unit can be used with the ignition off, but this will mean a higher drain to the battery and obviously has the potential to be left on by accident.
GUIDE:
At the back of the centre-console somewhere will be a chunky black wiring-connector, referred to as C40 in the diagram above, with 4 prongs and five wires joining either side. Two brown/violet wires from fuses 17 and 18 join at C40 and become a single wire - this is the best source for ignition power. The single brown/violet wire goes to a small 2-prong connector, which shouldn't have anything plugged into it, so connect the yellow wire here. The larger brown earth-wire on the connector goes back to C40 and grounds with the rest of the instruments and interior lights at G49, somewhere to the left hand side of the passenger side footwell. This is an ideal place to ground the black earth-wire from the head-unit, but modern stereos draw a lot of current and it might be worth running the black wire to a new earth-point on the centre-console bracket, as in the diagram above.
The only source in the dashboard connected directly to the battery is the cig. lighter circuit on Fuse 16 and has no spare connector so a wire must be spliced somehow into the red/yellow wire running through connector C40 - I just used a Scotch-block type crimp-connector. This new wire should be connected to the red wire on the head-unit.
To connect the relevant prongs on the head-unit wiring-connector I used short pieces of wire with female spade crimp-connectors. At the other ends are male spade-connectors to fit into the brown/violet wire-connector and similar connectors for the speakers, though I simply cut these off my speaker-wires and connected them straight to the head-unit connector with female spade-connectors.
Unlike the diagram above, 315/6/8 models should have green [pos.] + green/black [neg.] wires for the left-hand speaker and grey [pos.] + grey/black [neg.] wires for the right, to be attached to the corresponding prongs on the head-unit connector. These models should also have no rear speakers, unless they have been added on and will have a range of wiring colours.
Unless your planning on hiding your head-unit away somewhere, which I was originally, then you will need a fascia-adapter. They're not common, but can still be bought new from BMW or BMW Classic or one might come up on eBay, but I haven't found a spurious one yet. I was lucky to be given one with the car, still sealed in its bag. I intended not to use it and stash the head-unit in the glove-box or beneath a flap as security isn't great in the E21s, but I must admit it does look smart.
If a constant live connection to the battery is not something you want or your cig. lighter socket is already running a high-power device, then the simplest method is to just power both the red and yellow wires from the single brown/violet wire terminal [pic below]. This works just fine in powering up the head-unit, but the memory-power is turned off with the ignition and it won't save your settings or jump back to where a CD was previously playing.
It will also be drawing the full amperage through the rev. counter circuit, Fuse 17. This shouldn't cause a problem in theory, as the same terminal on connector C40 has a more direct route to ign. power, the other brown/violet wire from Fuse 18, but it still caused a problem for me after a week or two when the rev. counter/clock unit began to trip out and stop power to the radio and instrument lights somehow. Neither fuse would blow, but power would not return to anything on that circuit until both fuse 17 and 18 had been pulled out and re-inserted with the ignition turned on. You may get away with an extra or shorter earth wire, rather than the radio/rev. counter circuit grounding at G49 with the rest of the dashboard etc., but run this setup with caution.
