Talked to Sirius tech support. Two reps said they had no idea why it would sound like that.
The tech rep said he was inclined to agree with the theory that the BMW's system is manipulating the data size/rate so that it can store and playback quickly.
I have a feeling this will be one of those "it is what it is" deals...
So that was a wasted $600 feature of the Premium Package
I'll keep looking for some magic setting.