"If I were to trade in my R8 I would get..." a CAT-scan to see what's wrong with me.
But in all seriousness, two ways to answer this question: (1) what I'd personally do, and (2) what may work for the OP's situation.
For myself, personally, I'd buy something Italian that would crumble into 20 pieces and likely make me scream at it in foreign tongues. I've been in love with the 355 since it first arrived (and I was too young to drive no less buy a Ferrari). I can easily go buy one to "add" to the garage, but quite literally, I can't "add" it to the garage as I have no more space. So that's been a good practical inhibitor for a while... we'll see how long that excuse holds. Alternatively, if I was going to spend stupid money, it would probably be a 458 Speciale - I think time will declare this one as the pinnacle of the V8 Ferrari, being the best looking (since the 355) and the last naturally aspirated. Short of the Ferrari options (which both lost out to the R8 when I bought it!), the Huracan would be the more practical Italian option on my list.
Now, as for the OP... this is a tough one. The M5... it would leave you disappointed. Being a life-long BMW driver, I'm disappointed in BMW these days. The passion and design is gone. The latest M5 is a far cry from the days of the E39. While I'd admittedly consider one as a daily driver (because, well I need a daily driver), I could in no-way consider it a "replacement" for the experience of a real sports car. These are luxo-barges (they're huge these days), and the sound of the fake engine noises, muffled turbo engine, electric steering, 900 nanny systems... it's all so detached. Yes, blazing fast... but there's no joy in driving it, just a nice place to get from point A to B.
I said this on another thread (jokingly... but with some seriousness behind it) recently, but if I were considering a new daily (sedan) at this moment, I'd seriously be considering doing something radical like rebuilding a D3 S8 V10. This is a truly beautiful looking car, and at least with a NA V10 under the hood, it's interesting and sounds wonderful. You could pick one up for under $20k and spend $30k - $40k doing something truly amazing to it, and you'd have something far more interesting (for less) than almost anything in the segment new.
Now, if you wanted to do something in the sports car segment but just not as low or difficult to enter/exit as the R8... I don't know. The R8 is low, but it's not much different than most sports cars in my experience. So, I'd be skeptical of offering up ideas like the 911, which may be a small improvement but meaningless difference at the end of the day. What about something eccentric and still exotic but not necessarily a sports car - such as a Bentley GT? The new ones are ridiculously expensive, but I think they look fantastic - the interiors are exquisite.