MicroFilter Replacement
The microfilter was added in the '91 model year and is truly the worst engineering kludge on the E34 series. It must be replaced every 15,000 miles (or left out entirely!!) to allow effective HVAC air flow, but ironically it is very difficult to get to. Located under a yellow cover directly to the left (LHD cars) of the glove box hinges, it requires removal of the glovebox, footwell vent duct, a trim panel, and the HVAC control box You will need a Torix driver to remove the actual filter cover. It is known that failing to replace the filter can hasten the failure of the heater fan resistor pack, known as the "final stage" element in the later E34's. A major benefit of the filter is that the interior of the car remains cleaner provided you don't frequently drive with the windows down.
How To Do The Job
(As it was some time ago that I did this job there may be a few inaccuracies in the following description and the photos do not show parts disassembled.)
Allow about 2 hours for this job. Purchase a new filter from your dealer or OEM parts house, costing about $25.
Reach under the glove box and pull down on the two hinge levers at the back corners, unclamping the hinges from the fixed hinge pin.
Left glovebox hinge
Right glovebox hinge
Pull the box out a few inches and unclip the damper unit and wire stop cable at the glovebox end. Take the box out of the car or place it on the drivers seat.
Right side (strap) clip
Unscrew the carpeted panel on the left side of the passenger footwell, and then squeeze and slide out the plastic foot it was attached to.
Carpet trim panel
screw 
Panel retainer clip
Remove the large plastic trim at the left of the glove box area. One screw is near the top and there are several plastic retainer plugs which must be pried out. The wires to the flashlight socket prevent you from removing the trim from the car, but they are long enough to let you place it on the dash.
Upper plastic trim screw
You will also need to remove the screws holding the footwell duct in place. There are two inside the glovebox hinge bracket, one at the duct corner, and one at the end.
Footwell ducting
These two items eventually come out after a near-death struggle.
Slide out the HVAC control unit from behind (towards the firewall) the air box in the center of the car. It has a plastic spring lever that holds it in place. Leave it dangling on the wires.
The microfilter cover is a light-yellow colored cover with a Torix screw at the bottom and a stupid locking lever at the top. Remove both and extract the old microfilter.