I owned an Impreza prior to the S3.
A great car in terms of character and handling/grip, as well as the flat four rumble which is hard to beat.
I had it for just over 2 years and enjoyed it immensley, but felt really embarrased to drive it in the last 6 months of ownership. Dont get me wrong, it was a great car, but the people who started to get hold of the early '93 models started to really tarnish the image, thus it had to go.
The Evo is really the car to have if you want out and out raw performance, great for weekends and track days, but not so great when it comes to day to day driving. Its too hard, and too in your face.
Whilst the S3 isn't any of the above (at the moment), it does give a really good mix with its ability to be 80% daily driver, whilst also 20% fun car when needed, especially when re-mapped.
I nearly looked to change my S3 a month or so back, an Impreza Sti could be had for 18k (18 months old), but the interior is so poor, the Evo is as bad, if not worse + high servicing, running costs.
The M3 was a real contender, but unless you have 24K to spend, which will get you a BMW used car with a years warranty. It seems to be dangerous terrority to enter without a warranty, due to the large mechanical bills that these cars seem to attract. Also bear in mind that the M3 for £24k, will also be around 2002 model, which is a lot of money for a 5 year old car.
Its a real headspin trying to find something you can drive/commute in every day, then get the family in at weekends, but still allowing a slight "loon factor" to creep in when its not work or family time !
they may be faster, not all that good to look at, and sound like uve just nicked it off the local chav.
