ok, I'll bite... what is so much more "luxury" about the M3? Is it leather, trim, materials, electronic equipment (even motor trend hates that isystem that BMW uses).
Or, let's be honest here, is it just the price that makes you THINK it's better?
If the M3 was only 35k, would it still be the "luxury" car that it "is" at 60k?
The luxury is the trim, materials, and comfort. The seats are just light years ahead of the mustang's in terms of quality and comfort. I picked the car up from Chicago and drove it back to DC. After 12 hours, the seats were still incredibly comfortable and I wasn't fatigued at all. After 3 hours in the seats of my last GT (I know they changed them for 10+, and I've driven V6 Premium rentals for several hours at a time, but not GTs for an extended period), my butt would be hurting like you wouldn't believe. Not to mention the additional ways you can customize the seat to fit you best - adjustable side bolsters, leg supports, etc.
The quality and workmanship and fit and finish between the two cars are just light years apart. The 2010+ is a big step up from the SN95 and even the 2005-2009's, but its still way lower quality. The Mustang still uses way too much plastic and fake materials. It really shows once you have higher quality materials. The feel of the leather is much better too. The stitching on the M3 is impeccable too. All the pieces fit better and are more durable (at least from what I've seen).
Then there are all the features and amenities. Several of these the Mustang has in option packages, some it doesn't, but likely will. Most of these things are really little and silly and are the type of thing most people will say "Oh, I don't care about that." Well I said that too, but now that I've had them, I won't get a car without them. You don't realize how great it is to never have to take your keys out of your pocket to get in your car and drive away. The convenience of automatic headlights, auto windshield wipers, and auto climate control is just phenomenal. It has auto-dimming rear view and side view mirrors. It has adjustable
suspension settings, adjustable throttle mappings, and adjustable levels of traction/stability control - all of which can be easily changed on the fly. The parking sensors are amazing, and the seat memory is great. Being able to switch driving modes (from normal driving to M-Drive) from a touch of a steering wheel button is great too. The iDrive system has been greatly improved since the magazines first criticized it, and they all admit that now. It took me no time to figure it out, but maybe it is because I'm 25 and I've grown up using all kinds of electronics and computers. I also love that I can drive the car at 80 mph without feeling like I need earplugs. I know some people won't like that, but it's great to have a car that is quiet and well behaved until you tell it to do otherwise.
Then there are other little things - no cost maintenance. I don't pay for oil changes, brakes, or even windshield wipers. The quality of service at the dealers is night and day. The bumper-to-bumper warranty is longer. The resale value is MUCH better.
I'm sure there are other things I forgot. Another thing the M3 has over the Mustang is the ability to get 4 doors if you want/need it. I got the sedan, but I would've gotten the coupe just the same. There's also the question about looks - ask 100 people and you'll get 100 different answers, but I just think the M3 looks much more badass, stock vs. stock.
I do miss the grumble of the Mustang's V8, but at the same time, the sound of a M3's V8 at high RPM's rivals the Ferrari or Aston Martin if you ask me.
Someone mentioned the "stigma" of owning a BMW. If you care about that, then yeah, some people do think all BMW owners are d-bags. At the same time, some people think all Mustang owners are rednecks (although that applies more to Camaro owners, I guess) or juvenile street racers. As with all stereotypes, some people will fit the bill perfect, others won't. Personally, I'll never care what anyone else things about the car I drive. As long as I like the car, I'm happy.
In the end, people will assess the price difference and the extras you get with one car or another and make the decision that works best for them. No one's decision is wrong - it's all perceived value. That's why the open market system works. For many people on here, they'll see no additional value between the 5.0 and the M3, and that is fine. For me, I did - although I also wasn't buying a brand new one. But the cost of my used one wasn't a whole lot more than a brand new fully loaded 5.0 - and the M3 had just as much warranty and more features. Plus, when I go to sell it, I'll retain a much higher % of the value comparatively.
My comments shouldn't be misinterpreted - I'm not trying to knock down the Mustang by any means. I even said if you are looking for straight performance, the Mustang is a much better deal. Price independent, however, I can't see how you can really think the Mustang is a better car overall. Whether it is a better value overall depends on how much value you place on all the things I mentioned above. There's really no correct answer.