I'd go the e21 too
Mostly for nostalgic reasons as I've owned two in the past - initially a 320i manual, and then a 323i manual. Much more tail happy / less stable than the e30, but with the 2.3L 6 they went very well.
No one seems to have pointed out looking at the photos that the 323i has a Motronic 2.5L M20 fitted from a late e30 or early e34. Would be potentially more reliable than the mechanical K-Jet injected 2.3L providing the swap has been done to a factory standard and it would have a bit of a performance bump with 168hp vs the original 141hp. I swapped my 323i to L-Jet injection from an e30 back in the day due to the K-Jet being too old to be reliable and it worked well.
They can look great with a few subtle mods:
