I find this thread gratifying. A year ago I was going back and forth between the VW and BMW dealer, putting a couple hundred solo test miles on GTIs and various flavors of 1 and 3 series. Even though my car budget was $50K, I spent half that for the GTI.
Aside from straight line speed, a firm brake pedal, truly great seats (in the sport pkg), and an excess of luxo-trim (in the 3), I still don't think I gave up much of anything more buying the GTI. Except the likelihood of constant repairs for BMW being too clever and technical for their own good, and a certain snobiness (status?) of the ownership experience. But I do wince with 'what might have been' every time I see a late-model 3 coupe drive by, one of the most attractive all-around semi-affordable cars on the market IMO. The 1s, uh, not so much...
For half the price, I don't have much to complain about: nearly-equal street driving dynamics, a much better stereo, near-equal interior quality, punchy-enough engine and short gearing for the real world, hatchback versatility, more interior space, no 'status' issues, and useful standard features and technology w/o excess bells & whistles.