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"Catch is, if I don't upgrade the alternator, it is likely to burn out within a year"
Simply not true. The capacitor should help with dimming lights but with or w/o it, your alternator will be fine. On my '86 745T, I use to have a large cap but something happened to it yrs ago and it apparently shorted (or ?) as it began causing fuses to blow (no probs with it disconnected) so it's been disconnected for about 3 yrs now (havent replaced it yet). My car has a 100W amp from a newer '92 740 and I now have 2 amps, one for 4 speakers, one for the sub only and both total around 850W. My lights will dim at high volumes, volt guage goes down but the alternator's doing fine. I had another car with similar amp draw for many years, also had a 100W alternator and never had alternator probs.
Now, if you're always driving with high volumes, lights on often (like in winter) with blower motor on high and/or AC used often in summer, the battery doesn't get charged as well as it would be normally but that's it, usualy not a big deal. My 4 yr old battery doesn't always crank as fast as it should but it always starts the car. The lights dim a bit but only the guy in front of me is likely to notice so I don't care.
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