Vehicle - 2005 BMW X3, M54 engine, GM 5sp Auto trans, 166,000 miles.

I've just experienced a triad of lights plus Service Engine Soon different from the typical triad indicative of the transfer case gear issue so I thought it would be good to document this for others since I couldn't find anything regarding this on the forums. This series of lights consisted of a yellow brake light, yellow 4x4, and yellow trans, plus a later SES with the engine and trans going into limp/safe mode. I experienced reduced power, rough idling, harsh upshifts and downshifts and hard starting. When I pulled codes, I got a plethora of ignition, emissions, cam sensor, trans, and crank sensor codes. The only way to get the car to run normally again was to disconnect the battery for a while to perform a full reset. However, the lights would re-occur after a few miles and my dash would display a brief red battery light just prior to all three yellow lights coming on again and then red battery light would go out, and later down the road the SES light would come back on. Knowing that the cause could be any number of things, I took the vehicle to my trusted independent for him to diagnose. He too, was confused and baffled by the multitude of codes so his course of action was to clear all codes, and then drive the vehicle until the lights displayed again in order to diagnose from a clean slate.

Turns out that it was a bad crankshaft position sensor. He explained that the ignition module, abs module, dsc module, 4x4 module, trans module and other systems within the vehicle, all depend on a quality signal from the crank sensor and when the crank sensor sends faulty signals, everything goes haywire causing the multitude of lights. When the engine goes into limp/safe mode, it then triggers the SES light due to the engine not running within normal emissions and ignition parameters. Fortunately, he had a new crank sensor in stock so I had him go ahead and install a new one while I was there. My drive home was trouble free,

This issue should also apply to other BMW ix models with auto trans and m54 engines. Hope this helps someone in the future.