sallen, I have a Mk IV so I'm not positive about the Mk III, but on my car the air intake for the TDI engine is just below the hood (bonnet) between the VW emblem and the left headlight. I am using an upper grill block made of black foam pipe insulation stuffed between the horizontal grill bars, except the top left opening (just right of the emblem in your photo) You might check as I wouldn't want to do anything to restrict intake airflow in a diesel. Incidentally, I use the same pipe insulation split and notched to fit over the grill bars on my lower grill for a partial cold weather grill block. It's cheap, nearly stealth and easily removable in 10 seconds if I start running warm.
