After a very fun three years and 10000 miles second gear decided it was too good for me so I did my research here on the forum and came to the conclusion that I should just order a replacement gearbox from eBay. It is now here and it looks like next week will be the week to do the job. Any words of advice from the poor souls who have been through this before me? I plan on running synthetic in the new gearbox. Which seals/gaskets do I need to have on hand before I start? What is the best lube I can buy off the shelf here in the US for the splines? I plan on having the clymer handy as I go through this. Thanks in advance.

Can't help w/the swap-out, but Guard Dog Moly GD525 is what you want for the splines.

You will spend 30 minutes on the floor swearing that it won't go back in, you will take a deep breath, do nothing different and it will slip on like it was made to.
Be patient. Push straight. Don't bend the pushrod (let the weight of the gearbox hang unsupported).
You don't need to take the exhaust off if you have a very long, 8-10" socket extension for the one hidden hex bolt with a small piece of 6mm allen key in it.

Did it last weekend. Pretty much how it goes for me every time.

Get two of the longest 8mm-1.25 bolts you can find, at least 4".  Cut the heads off and screw them into the engine on each side.  Use them to support and guide the transmission into place.  They will make that 30 minutes on the floor cursing only take 25.

If you can't find Guard Dog, stop at your local Honda dealer and get a tube of Honda Moly 60.  I use Mobil 1 synthetic in my transmission.  Make very sure you put a little spline lube on the clutch splines while everything is apart.  That helps with making the shifting a lot smoother.  Especially between 1st and 2nd.

If you are ambitious, you might want to check the grub screw that holds the internal shift lever on the shifter shaft.  If there is any slop or free play in the external shift lever at all, it means that grub screw is loose and probably getting looser.  It seems that of all the places BMW decided to use that damn red Loctite, that screw wasn't one of them.  It starts with a little play, then gets to where you have to move the lever 4 inches or more and then it finally falls out and you are permanently in that gear.  You'll have to split the cases to get to it, but there are a couple decent videos on You Tube.  When I did mine, it took about two hours of fooling around to split the cases, clean things up, and reassemble with the grub screw sealed with Loctite. 

There is an o ring on the clutch shaft that is highly recommended to be changed whenever you're in there.  If you don't change it, the old one is guaranteed to leak.  Don't ask me how I know.  It is #11 on the clutch drawing in the BMW parts fiche.  Part# is 11 21 1 460 456

Cut-off bolt idea works very well.  Also put gearbox in 5th when refitting.  It makes spline engagement go much easier than leaving it in neutral.  Twist output shaft by hand slightly while pushing; splines will magically mate.

Put spline lube on the SPLINE INPUT SHAFT.  Excess that is pressed out will be flung harmlessly onto the transmission housing.  Do the opposite and you'll contaminate the clutch plates, needing a clutch replacement.

good link ==>  http://classickbikes.com/ckb.tech/0.ckb.tech.files/splinelube/splinelube.htm

Don't be afraid to chop up a few M8 bolts to make life easy. I used M8 x1.25 coach bolts (cup head, smooth shaft)  120 mm long cut them to different lengths so that you are not wrestling to get the gearbox on any two at a time. The box will slide easily on the smooth shafts and a wiggle and lift with it in 5th as Robmack said and you won't need any swear words!!

Yer all getting old and soft, that's what it is. After fighting Guzzi gearboxes for the last twenty-eight years putting a K-box back on is dead easy!!

"Yer all getting old and soft, that's what it is."  Its some what akin to putting a cast iron powerglide back on to a small block chevy while lying on your back under the car. Think old and soft is best for me now

Finally got a full day I could dedicate to the job and got the swap done. Man what a difference! Not only can I trust second gear again but every shift is buttery smooth. It's like a new bike. Who ever put the 40000 miles on the donor gearbox must have been gentle. My splines weren't terrible but the new ones looked factory fresh! Thanks a lot for the help guys. I used the cutoff bolts and they worked spectacularly. It's amazing how much confidence comes from knowing the bike is working properly.