Yeah, the M46 has a very short first gear, even with a fairly tall rearend (I think my car has a 3.54) mine rips through first pretty fast -- too fast to really be useful I think, I doubt it even builds full boost and you run out of revs almost immediately. Yours must be even more extreme, with more power and a shorter rear. I think these cars would benefit from having the tallest rearend possible installed. There is certainly enough torque to make use of taller gearing.
We might need another video now that you have the stick in.