I'll admit that that wasn't my experience at all. I transited in Delhi twice in 2012, and both times I must say I found it a very pleasant place to transit at. Transit security is organised in a rather bureaucratic way (little stickers, long line, men and women going into separate queues, etc) but once in the departure area I thought it was fine and the lounge I was at was good (unfortunately I can't remember what it was. I was flying on with CI if it helps).

As others said, depending on your passport, it is most likely that you wouldn't be able to go to Delhi unless you get a visa first, and the hassle and bureaucracy (and expense) of getting an Indian visa is not negligible. I doubt it is worth it for - effectively - 4 or 5 hours anyway. You won't get lounge access based on your BA flight as there is no arrival lounge provision and you are continuing to a non-OW flight but paid lounge access is an option. I have no idea if there is an airport hotel within the airside are with day rooms as seems usual in most Asian airports but if there is that might be your best option.