The issue is as you described above...so thank you!!Hi, when you say no air until position 4 do you mean that there is no fan noise either?
If so sounds like an issue with the fan resistors. In positions 1,2 & 3 the power goes through a resistor to drop the speed but on position 4 it is straight through at full battery voltage.
Might need to replace item 2 on this....
RealOEM.com Â* BMW E34 M5 3.8 ELECTRIC PARTS FOR HEATER
Or you might be lucky and find a loose connection!
Hope that helps.