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My understanding is the original reason behind the 1,200 mile service is to remove all fluids containing metal from the initial contact between all the metal surfaces in the early part of break-in. The oil and filter in the engine/transmission and the fluid in the diff keep these particles in suspension but you don't want to keep them in there for an extended time frame (5,000 or 10,000 miles until first oil change).
Also, if BMW uses break-in oil (they might, but this is closely-held info) they'd want it out in relatively soon (1,200 miles).
Finally, it appears there is software that is flashed upon the 1,200 mile mark...some parameters of the engine are changed prior/post 1,200 mile service. I'm sure going over by a few hundred miles is no big deal. The real intent is to have the early service performed at some point.
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