As several people mentioned, regular fuel will not hurt the M35. That having been said, while it isn't true in most engines, yours will have better performance with premium because it has to de-tune itself to run regular.
What is really concerning to me is that no one has responded to this:
Infinitigirl14 wrote:However, I feel a slight hesitation when I accelerate, I wat h the window with RPm needle jump and everytime it does my car hesitates.
Unfortunately, I can't really offer any input on it, but it might be helpful to describe which direction the needle is jumping, from which RPM to which RPM and how much hesitation there is (maybe in time?).
Regarding your consumption concern, my 2006 M45 (which does require premium due to the V8) has had a problem with the gas gauge since it was under warranty, but the dealer couldn't find the problem to fix it. When I'm driving along with the gauge somewhere under 1/4 tank, the needle will drop all the way below E and stay there for a short while (maybe a mile or two), then it will come back up to where it was. When it does this, the fuel economy screen will change from whatever miles DTE to 0 miles DTE (and it actually says 0 miles instead of saying ** miles like it normally does once it gets low enough that it won't estimate). You could be seeing something similar to that where it is just a calculation/reading issue.
Additionally, when I fill my tank, say it says I have 380 miles DTE and it showed an average of 21 MPG before fill-up and reset. I can drive 100 miles and have an average of 21 MPG on that 100 miles and it will definitely show a number lower than 280 miles DTE. However, in my experience, the miles DTE number consistently gets further and further from reality (in the negative direction, meaning you could go farther than it says) as the tank gets lower. Additionally, the miles DTE number is based on a recent short portion of your drive, so when you drive around in town, it will drop due to the lower recent mileage, and when you get out on the highway and drive 15+ miles, it will at least stay the same for most of that drive if it doesn't increase.
Given that these numbers are not really consistent and are mostly just for reference, it's probably not worth getting worried over them. However, what you can (and should) do is actually calculate your mileage and compare it with two things:
1) The average mpg in the fuel economy screen (which you should reset each fill-up when you calculate). This will help you determine how accurate your fuel economy screen is (mine will be up to 1 MPG low in the summer and up to 1 MPG high in the winter).
2) Average/expected fuel economies (some people use fuelly, fueleconomy.gov can provide the recalculated window sticker numbers and some average numbers from real world drivers).
To calculate your fuel economy, you should fill up the tank, reset your tripmeter, drive until you're ready to fill up again (over the course of a week or whatever), and then repeat. Each time you fill up, you take the number of miles driven divided by the number of gallons pumped to get your MPG, which you can compare to the resources just mentioned.
You can also use an app to calculate and track this. I recommend acar if you have an android mobile phone (don't know if they make it for iPhone). I think it may even be free if fuel is the only thing you want to track.
Hopefully doing that research/calculation will help you find out that your fuel economy is where it should be and give you one less thing to worry about.