1. The thing about the test drive that really sold me on the X3 over the other cars we were looking at was the HUD. I kept telling my wife that I felt like I was the Terminator.
2. I'm not familiar with the colors of the 3 series HUD so I can't compare. The predominant color is a yellowish/amber for the text with accents of red, blue or green depending on the alert message.
3. The default display is your current speed. It also posts nav directions, cruise control info, traffic alerts, open door warnings, and various system warnings (one I am very familiar with is "tire pressure monitor failure", which is its own annoying thing that is currently driving me crazy)
4. These are not comprehensive videos but these links should give you an idea of the HUD's flavor, especially since these are the indicators you will see most often:
speed and nav directions:
startup screen, low fuel indicator:
I'm not near my car now otherwise I'd list out the various category of things you can select to be shown in the HUD. I believe the general rule of thumb is that any alert that would pop up on the instrument cluster can also be displayed in the HUD.