I believe you can go all the way up to a 1.9 with turbo on it. 1983 or so vintage. I am putting a turbo on mine today and I snagged it from a guy on Craigslist and most of the parts to make it work. Still had to get some hoses and a couple of gasket kits and fittings for the oil drain.
I think all the MK 1 and MK 2 engines are an easy swap. For sure, stay with the diesel.
I think all the MK 1 and MK 2 engines are an easy swap. For sure, stay with the diesel.