I've only done it 3 times but with different approaches. This is the perspective of someone working alone. Removing is much easier than dropping it in. With a few socket extensions I was able to undo the bellhousing (not hard at all) after removing the tranny like ahab as described. Have done both the auto (ZF3HP22) in the E3 and the 4 speed on the E9. Both of those boxes are light enough that I've done the 'bench press' style removal and insertion but bought a Harbor Freight tranny jack and it made the process much easier and less stressful for the last one. I'm not implying this is THE way to do it just sharing my limited experience. I'm sure those of you who have done it dozens of times can likely do it *any* way and still be competent at it.
I dropped the engine in the E3 from below along with the subframe. For that I had 3 helpers but none of them an expert and it took longer than it took doing it by myself the second time I did it, alone. I did not want to mess with hood alignment, especially in light of the car being recently painted:
The second time it was on the E9 and I went from above as the hood was removed for engine compartment painting. That was far more difficult for me, even with with my 14 YO son helping, than the other two. The way the engine balances from the two lift points places it at an angle that is too horizontal to drop onto the mounts, even with them pretty loose all around. I had to use a small come-along strap to place the engine on a more vertical plane and it still didn't quite align with the mounts. A real struggle. No humor to take pictures of that one. Aligning the hood on the coupe was not trivial. That can be a thread all on its own. But since doing the 'drop' from below is so much easier, avoiding the whole hood project is just an added benefit.
The last engine 'drop' was on the E9, done from below with subframe and did it by myself. Not bad at all. BTW, credit goes to Mike Pugh and the '02 guys from whom I picked this up. You can see in the photo below that two floor jacks raise each side gradually, with jackstands supporting all the way, until I had 31-32" clearance on the front such that the subframe assembly mounted on an HF ATV jack (with a surplus cabinet board bolted on top) fit under the vehicle. No need to do it on the driveway even if you have a low garage roof, which I have. The body then gets lowered gradually until each side approaches the subframe mounting base. Longer bolts temporarily assist in the initial docking of the subframe to the body. All ordinary safety precautions I've not outlined here apply. Be careful and use common sense.