if you want to upgrade but stick to insurance freindly 50/50 weight ratio 4 pot rightness (assuming this is why you went for 1.8 in the first spot you can bung in an m10, this was my weapon of choice, they are by far the cheapest to make sick upgrades to.availiable in 1.6, 1.8 ,2.0 + 2.0 turbo
all that is neccesary to change is e/bay wiring + zaust obviously the engine helps too, these can be taken to 2.2 litre, turbo'd the hell out of and the average mot man would be none the wiser(bar the turbo) this ewngine is directly decended from an ex f1 engine which pulled 1400bhp, you can build them to 2002tii spec without having to bore the block. and am pretty sure a twin cam head can be fitted.
run a forum search on 2002tii or si318i and see what you find, youll get a good engine + wiring for £50 quid, zaust for £120. they aint faster as standard but can easily make a 6 pot killer + pull over 250bhp all day every day. only ever heard bad reports on them from people who have never had one, or have fear of old tech

Cars and girlfriends have alot in common.
They both make you angry+ make you cry, bleed your wallet + moan when they are old.
But at least the car makes sense!