One essential part of the M60B40 swap into an E30 or otherwise is to eliminate EWS if you got an engine from an EWS car. EWS is a security system meant to prevent your car from being stolen and subsequently started. The reason the 404 DME (0261200404) is used is because it does not have EWS programmed into it.
Generally M60 cars built 12/94 and prior had 404’s from the factory and 484’s thereafter.
The solution is rather simple, when swapping the 484 (or other) ECU for a 404 ECU you need to cut pin 66 which is a neon green wire at the ECU plug. Make sure when cutting the wire to confirm the color of it, as you may be looking at a yellow wire with a thin green stripe which is pin 78.