I love it that is the car I learned to drive on wayyyy back in the day. I have a big soft spot for these cars. If I would not have sold off my 1.4L 3 cylinder TDI a while back I would have tried to convince you to swap that into your ride
However I still have a lot of spare 1.4L parts like honed engine block and cylinder head waiting to be ported. I can also get more of these engines on the cheap at anytime. If I didn't have other projects going on this is what I would probably be doing myself. A 150hp 220 ft/lbs 3 cyl TDI rabbit with a CTN transmission would absolutely be the most bad*** combo there is I think. You would have over a 100mpg car with performance in the 6sec 0-60 club
It would run circles around my MK3 Jetta TDI and make it look like an overweight fuel guzzler on a twinkie diet lol
Whatever you decide to do with this Rabbit I for one will enjoy the build and look forward to your adventure. Welcome to the wonderful world of ecomodder land. Now there is no going back hahaha
GH