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The plastic bumper cover is flexible: You can pull it outward an inch or so with your hand so that it is flush with the outer tire surface.
Also, you can lower the car by cutting some of the front springs. On E34 BMW cars, cutting one turn off the bottom of the spring will lower the car by ~25-40mm.
If you pull the plastic bumper cover outwards and heat treat it to stay out or used a simple strut to hold it out, and also lowered the car by cutting the springs, you would not need the air dam.
You could also make an air curtain like the latest BMW 3 series cars have, by ducting ram air from the nose to a vent at the upper forward section of the wheel arch.
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