Some thoughts...
Hey ALH TDI Friend!
First, ditch the K&N. A quick googleing will give you all sorts of horror stories. Short answer is it ruins the MAF.
Most of the work the mechanic is doing is normally thrown on top of changing the timing belt and cleaning the intake with a new2you higher miliage car. When you get it open you might find you also need a new cam seal(easy) and/or crank seal(more difficult).
Most people who buy these cars used change the timing belt so they know the true zero and that it was done right with good parts.
Not saying your mechanic isn't good, but be very careful. If you are mechanically inclined it is to your advantage to get the few special tools and do your own work.
VAG-COM is required. Read all you can about timing for full requested range. If you want it bumped, use the variation and mechanically time again and test to get full requested range.
A scanguage or other will help train you. It also helps with codes and monitoring things. It had been stated here and on other sites, make sure your thermostat is working properly. You can't even time one of these engines without it at full operating temp. A stuck open stat will never get there and your 50+mpg will be 35 easy as that.
I have done vac lines in OEM braid and in silicone. Get silicone. Easier, better and looks trick. With known good lines it makes troubleshooting easy.
Search for the door lock microswitch repair threads. Man are the overly complicated door mechanisms fiddly. Better to yank some from a wrecker and have them ready for when they malfunction.
Someone might have mistreated your gearbox. The manuals aren't known to make metal. Change the fluid and hope for the best.
Most effort with any worthy older car is removing the idiot tracks left all over it by the previous owner. The alh is worthy!
If you havent seen, you can lose a lot of the exhaust system. Check online.
I would do the ventectomy(easy) and cut out the snow screen and get the cold weather paper element. Google is your friend!
On big road trips with the family, I have to stop for every reason but getting fuel...
Good luck!
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