That's such an interesting read RR, he describes everything that's wrong with mine. Difference is, all my parts are stock, as I replaced the pads and discs about 4 years ago when I sold the car and they were all bought from the dealer.
It has big 4 pot Brembo factory calipers on the front and the feeling is ridiculously soft. I've had several people sit in it at this stage and they all agree its not right. There's just no bite at the top end, not even in the middle of the pedal.
One line Richard said in his post resonated with me:
"When I was bleeding the brakes the last time (pressure bleed with GT1 cycling ABS valves) the pedal felt awesome during the bleeding procedure. It was rock solid (no sponginess) and it was right at the top. I remember thinking to myself "Wow, this is going to feel great now" but once I finished the job, lowered the car and took it for a drive, it felt the same as before. "
Mine's JUST the same, I think all is going great and i've finally fixed it, but once the system is sealed again and engine fired up, the pedal just drops near enough to the floor. Compared to my E66 740 it's night and day; I even sat in my mates 525i E39 and his is proper hard too towards the top.
The rear pads on the E38 are down to the wear senors and the fronts aren't too far off either so i've a set of Brembo pads coming for all four corners on Monday. I very much doubt they'll change anything, but fingers crossed.
So frustrating, i've had a few people "in the know" look throw their opinions about and no one is sure. It's such a simple system:
Pedal -> brake booster -> master cylinder -> ABS unit -> line valves -> calipers
Brake booster certainly boosts, master cylinder is brand new, ABS unit could potentially be at fault if that squelching noise isn't normal, all line valves block pressure when tested, no leaks at calipers. The brake hoses are rock hard so no ballooning.
I ran the ABS pump several times for each corner whilst being pressure bled, in conjunction with slapping it on the side to dislodge any potential air, no difference.
So frustrating.
In my eyes, its either the brake booster applying too much boost (if that's possible) or it's the ABS module with bad internal seals or air I can't get out.