Your pressure relief valve is stuck open.  My broken pickup tube is
damaged at this point.  On mine, the pressure bleed hole is greatly
enlarged where the casting broke.  Even with the damage, the valve
closes all the way to where there is no gap for oil to escape.

At this point, you appear to have little to lose by removing the
pressure relief valve and cleaning out whatever debris is preventing it
from closing completely.  I can move the piston fairly easily in its
bore against the spring tension.

The pressure relief valve is obviously peened in place. I'm sure that it
can be carefully removed, but not so sure how easy it would be to put
back. Other than peening in place like the factory, you might consider
cutting a few threads in the housing for a threaded plug, cutting a
groove for an inside snap ring, or drilling across the diameter for a
roll pin (or two) to retain the end cap and spring. A local machinist
may have some better ideas.

Best of Luck,
Mike Snow

> I've scanned pics of the parts in question, and posted them on my site
> here: http://www.sfu.ca/~tcopley/vw/noprime.htm
>
> I'm open to any and all suggestions, ideas, observations, etc.  BTW, if
> the valve *does* appear to be in the wrong position, I have no clue how
> to repair it (or even if it can be fixed at all)