[Billfitz]

Like all myths based in fact. With a purely mechanical AWD system that tied the front and rear differentials together you could have problems with different size tires, among other things, like going around corners at higher speeds. That's why they disengaged the AWD for normal driving, engaging it only when they needed it.
You wouldn't want to have decidedly different tire diameters front versus rear with xDrive, but a very slight difference would be OK. With 26 inch diameter tires 1% would be only .26 inches, which is about 1/4 of an inch. You could have that much variation from tire to tire just from differing air pressures. I can't imagine even 3% variations being a problem. 5%, maybe.

Edit: Math corrected. Note to self: Don't do calculations in head after the sun's gone down.