BMW: Engine Stalls and very sluggish, timing belt replacement, proof engine

Question
Hi Josh,

Thanks in advance for any help you can provide.  I have an 86' BMW 325es manual shift with approximately 150K miles.  One day while sitting in traffic the car stalls.  No problem starting back up again.  A few days later I noticed sluggish acceleration.  Today the car stalls at idle each and every time, and the car won't go faster that 45 MPH without a hill and a tailwind.  I recently replaced catalytic converter, spark plugs (wires are on order) and can't drive the car because of the 40 MPH minimum speed requirement on our highways.  A so called mechanic suggested timing belt replacement, however I don't wan't to keep replacing parts based on some mechanics guesswork.  I respect your opinion due to your expertise, so any suggestions you give are highly valued and appreciated.  Thanks.

Answer
Patrick,
 I will try to help as much as possible.  Nice car by the way, the 325es is wonderful machine with a bullet-proof engine.  
 
 The problem I have is that I need to know the symptoms that the car is having.   I know you said it wont go over 40-45 MPH, but is it sputtering or back firing while doing this?  Is the car making any noises or acting funny at any other times.  I need to know When, how, where everything to help diagnose this problem.  
 It sounds like it could be an ignition problem that is happening under load.  I know you said you changed the spark plugs and the wires are coming (you are on the right track) but make sure to change the distributor cap and rotor with the wires.  This is most likely where your problem resides.
 I hope your mechanic wasn't suggesting the timing belt would solve these running issues?  The ONLY way the timing belt would affect the engine's performance was if the belt was broken.  Now, if you have not replaced it yet, it should be replaced soon (they have 100k-150k mile life.)  If it breaks while your car is running then it will cause major damage to the valves in the cylinder head, and major damage to your bank account!

 You should also check your fuel pump(s) to make sure they are both working and pumping the correct pressure to the fuel injectors.
 Hope this helps,
 Josh