I found that when I removed the valve cover, the breather hose and the
breather filter were nearly occluded with gunk.  After some time in my
solvent tank, I got everything back in tip-top shape.  The VC seal was
so brittle (original?), it came off in pieces.  The only problem I
have with these engines is focused entirely on the timing belt. I
strongly feel that no interference engine should have a timing
belt--period.  I had to buy the special camshaft holding bar, and
crank positioning pin in order to R&R a leaky thermostat seal.  I wish
VAG would finally drop timing belts altogether, especially on their
diesels.