Water pump replacement - Two questions

[ElNormo]

So I'm beginning an epic water pump replacement. Epic, as in, it will take me a long time. Two questions to start out...

I've drained the radiator coolant, and am looking for the engine block plug. I see a plug that's about the right size, is this it? I'll attach a picture...

Also, I've got a 32mm wrench, but it won't quite fit into the nut around the fan. Is there a trick to get a wrench down there? Do I need to grind it down narrower?

Thanks!

Norman

[shogun]

not that one, the freeze plug is higher on the cylinders, see here
http://www.pelicanparts.com/cgi-bin/ksearch/pel_search.cgi?please_wait=N&forumid=&threadid=&command=DWsearch&description=11+11+1+714+712+&I1.x=11&I1.y=10&FILTER_TECH=ON&FILTER_SUPP=ON&FILTER_ACCE=ON&FILTER_CARE=ON&FILTER_STUF=ON&FILTER_PERF=ON&FILTER_MISC=ON&FILTER_GADG=ON&FILTER_TOOL=ON&FILTER_ABMW=ON&FILTER_BE21=ON&FILTER_BE30=ON&FILTER_BE36=ON&FILTER_BE46=ON&FILTER_BE12=ON&FILTER_BE28=ON&FILTER_BE34=ON&FILTER_BE39=ON&FILTER_BE7S=ON&FILTER_BEZ3=ON&FILTER_BE68=ON&FILTER_BE02=ON&FILTER_BEMI=ON&FILTER_BEX5=ON&FILTER_BMWM=ON
# 7 http://bmwfans.info/parts/catalog/E34/Sedan/USA/535i-M30/LHD/A/1989/may/browse/engine/engine_block/
But, I have never in my life removed a drain plug on the engine to change the coolant.
I change it every 1-2 years and that is fully enough to get all out at least the second change. Because that little bit what is in the engine is then mixed with the new coolant depending on the distribution of the coolant to small or large cooling cycle. And in any case you will not get out the larger portion of the coolant from the heater core, unless you wold try compressed air or something like that. Just leave it in and change the water pump, bleed, refill new coolant.
More important is to have a good flow back to expansion tank like Gale writes it down here

http://www.nmia.com/~dgnrg/page_19.htm
The wrench should be a bit skinny, see these nice instruction from Gale
http://www.nmia.com/~dgnrg/page_14.htm
Fan clutch: remove with a skinny 32 mm or 1-1/4" open end wrench per Photo-1 & Photo-2. Wack the end of the wrench with a large mallet -- note that it is a left-hand thread. The nut will now unscrew. If the pulley slips, tighten the alternator belt & push the belt down to take up slack & smack it again. If it still slips, you can sacrifice the belt & clamp a pair of vise-grips on it just ahead of the pulley & replace the belt with a new one. There is also a BMW tool to hold the pulley to keep it from rotating. Store the fan clutch vertically if reusing. I used a cheapie wrench from a discount tool supply & cut it down to 1/4" thick with a flycutter on a mill. One could use a grinder but that takes a while. You might be able to get a skinny wrench at a bicycle shop. Alternatively, you can remove two of the adjacent 6 mm hex screws on the fan pulley to make room for a large crescent wrench.

Thermostat: Drain the radiator, plug is on lower left corner of the radiator on the engine compartment side. Remove the 4 screws shown in Photo-3. Install the new thermostat with the pointed end facing forward as shown. There is a small arrow stamped into the brim of the thermostat, install it oriented upward. Put a little vaseline on the o-ring to hold it in place & to seal it well & re-install the housing. Install the radiator drain plug & add coolant to the overflow tank. Squeeze the front hoses to "burp" the air out of them & unscrew the vent screw (8 mm head) in the top of the thermostat housing until a good stream of coolant comes out, & tighten. I do this with the engine cool & off. You might want to repeat this after driving a few miles after it has cooled down again. If it has trouble bleeding, check for blockage in the small return line from the top of the radiator to the coolant tank (thanks to Thomas Meacham for this one). With the system cool, Remove the Radiator Cap. Start the engine and look straight down into the Coolant Tank opening. If you see a stream of coolant about 1/8" ( 3 mm ) diameter returning to the Coolant Tank then everything is OK. If not, then you will experience trouble bleeding the system next time.

As for the water pump, Jon Evans has a good write up
http://evansweb.info/articles/2003/01/18/water-pump-replacement