Alas, I'm on this fence as well. My lease on my TSX is up soon and I'm looking at these two cars.
Had two Z's before (300zx and 350 - for too short of a time unforunately). Love the Z and definitely would like to go back, but also wouldn't mind trying something different. I've test-driven both cars once.
I like the idea of the 1. Cars have become so bloated. 3 series are the size of old 5 series. But as people pointed out, the 1 is still a heavy car. Really like the torque it has and it is definitely more comfortable than Z, less claustrophobic (I'm used to the TSX by now). And BMW's have a certain road feel, they're wonderful to drive.
However, the Z is definitely a sports car and it was a blast to drive too. That cockpit is great, and the car will likely prove more reliable (the fuel pump issue on the 135 concerns me). And where I live in LA, 370'z are less common so far than 135's (that may change).
I just wish both cars had a back-up camera.
I think I'd enjoy both just as much for different reasons. Another test drive of each is need. It may come down to the deals I can get. If it's a 135, I'll likely lease, a Z would most certainly be a purchase.