There isn;t anything wrong with the engine in the MINI, it happens to be the same one as the PT Cruiser, but the smaller version of it. Now before people start banging on about the PT Cruiser being underpowered and hence the motor is crap, just listen a second. I have a PT Cruiser, it is a good car and the motor is anything but a slug. What it lacks is torque in it's std form. Why is this, mainly due to the Chrysler policy of tuning cars. Torque is not a priority for chrysler. They do have a highly intelligent computer controlling it. It learns. I tow my mini with the cruiser and to date have had no issues, sure i have to change down a gear to get up hills but my fuel economy is not do different to towing with any other 2l. and the longer i tow the better the economy.
Having said that, the 1.6 in the MINI is a strong tough engine, for the size of the car it is a great motor. To date I haven't heard any issues with it from anyone. So a strong reliable motor can't be a crap motor. And from all reports the cars in std form are quick.
The reason or so i am led to believe that the chrysler motor ended up in the car is that there was a deal done behind the scenes for 4-5 years between chrysler and BMW to supply the motor's. Chrysler had the motor's sitting on the shelf. BMW didn't have anything that would just slot in. BMW has now come to the end of that deal and are have designed(or bought) a new motor that is better and i would suspect cheaper than the current one. Of course BMW would look to make it's cars better and cheaper to manufacture, that is the business, it's about money and it's about improvement of the cars for the customers, which in turn makes money.
I do think that to bag an engine as crap, without being a regular user of such a motor, is just sad.
Cheers
Aaron