My early 90’s fuel injected Toyota Corolla does this. The part where it surges in speed a little as the speed drops to 5 mph is very noticeable, but the part where the engine brakes when I take my foot off the gas doing 35 mph is pretty subtle. But I definitely notice it as sort of feeling like the car is being dragged to a stop by the engine. More noticeable that on pre-fuel injected cars I’ve driven. It may be more noticeable in higher compression cars like your BMW, since it is the engine compression that is doing the braking. That might be the explantion.
It could be something more serious I guess. One way to determine would be for you to drive another BMW and see if they do the same thing. Maybe go over to the BMW dealer this weekend and do a test drive of the same model.