Sort of funny, but the car came with an ABZ 4.2 V8, with the correct clutch and flywheel for my 90. But i have seen a few of the v8 swaps and all have to make compromises. Normally no AC, and they still have overheating problems. I chose the 1.8t since it would fit in the engine bay, has OEM mounts to mount it to the factory motor mounts/positions. Like you said, sky is the limit for upgrades, and i bought a complete running a4 for 500 bucks, and it ended up having a k04 turbo on it already. I'm able to keep my engine bay in the same standard configuration (ie my radiator and fans stay up front, if i had gone 5 cylinder, i would have had to move to a side mount and make mounts/provisions for all that). Also i like to do things a bit different, not many have done 1.8t swaps in b4s, and even fewer have documented it like i have.
"If you can see the tree you are about to hit, it is called 'understeering'. If you can only hear and feel it, it was 'oversteering'."