If you do a search on roadfly's Cayenne forum you will find that I've stirred up more than a few feathers with comparison tests between Cayenne (S & Turbo) againts my previous 4.6is and now my 4.8is.
By way of reference I am an experienced track and race driver (national championships, Porsche racing etc), so I really push my cars and after taking out several BMW UK execs they confidently stated that they'd never seen an X5 being driven so quickly and had no idea it was so capable
I drove another Cayenne S recently (a 2005 model that has been much improved over the earlier 2003 Cayennes I drove). Let me try and sum up the key differences as I see it.
First and foremost the Cayenne is a very accomplished car, but contrary to the early journalist reviews it's not in a different ball park to the X5. The first comments people often make about the Cayenne is that it looks more modern than an X5 inside, but then the X5 has a classic interior (probably BMWs best) so you're entitled to make a personal choice there. Rear seat space in the Cayenne also seems less than in the X5, although it has a bigger boot (not least because it doesn't have the wheelarch intrusions that the X5 needs to accomodate the 315/35 tyres).
Driving wise Autocar magazine who recenlty tested a Cay TT against a 4.8is and RR Sport described it as "curiously devoid of personality" and "a take it or leave it device". They concluded that "we all admire the Cayenne from a distance, but none of us, somehow, felt any real connection with the Cayenne Turbo during the three days it spent with us, except perhaps when it was accelerating hard out of a roundabout in second gear". Of the 5 or so Cayennes I've driven over the years I've found myself comparing them with an Audi Sedan, well built, competent but clinical and lacking in any real personality. The 4.8is by comparison is gregarious, always up for a bit of fun and the one that most enjoys being driven hard.
The Cayenne S that I recently drove felt so much slower than the 4.8is I had arrived at the dealer in, whilst it cornered flat and steered precisely it could never hide the fact that it was heavier and less agile than the X5. There's also a 'big' difference in the sound they make, the 4.8is is just wonderful and whilst the Cayenne S can have its exhaust modified, it only ends up sounding as good as a 4.6is IMO. The steering on a Cayenne whilst accurate has none of the feel that I enjoy in the X5, hence it's less satisfying to push through corners. In the 4.8is I can set it up and 4 wheel drift through a fast bend, whereas the Cayenne just felt far too sensible for such a stunt. Sporting is not a label that I find easily sits with the Cayenne, although it will accomplish a very fast journey time (or lap of the track), it does so without ever really involving the driver.
I've tried to like the Cayenne (being a Porsche fan) but have never found enough personality to really stir any desire. Couple that with far poorer fuel economy and a less sporting drive and the sums just don't add up.
The reason often heard as to why someone chooses a Cayenne over an X5 is because there are too many X5s in their neighbourhood, but personally I don't let other people define my choices for me.