My Mk2 8v is on standard suspension which is now 15 years old. I quite like the ride there is a little more body roll than I would like but it's not an issue. I don't want to mess around with adjustable settings or have it too low just fit and forget. Can anyone suggest an upgrade? I don't mind splashing out so budget is not an issue. Is it true that the 16v suspension is slightly lower? anyone have experience of driving both, would a 16v setup be the best option.
I could replace with standard vag items but surely suspension has come a long way in 15 years.

if you don't want it too low, i'd suggest a Bilstein Cupkit.

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'68 Type 3 Squareback / Rabbit Truck 2.0 16V ITB

Your best bet is probably to get a complete set from a well known tuner like Koni, Eibach, Weitec, H&R etc. If you don't want to go low, get a complete -40mm or -60mm set, depending on your wishes. The lower you go, the more you need firmer shocks.

If budget isn't an issue, I'd go for a fully adjustable coilover set from Weitec or the like... that way you can set the height to exactly where you want it, and also adjust the firmness of the shocks... Fitment is also relatively simple, it replaces the whole shock/spring setup that's currently on your car.

Would the KW variant 1 suspension kit be a good idea I seem to read good reviews about them.

To be honest, I've never had a KW set. But KW's are supposed to be pretty good...

Like marcski said I would suggest a cup kit. H&R makes a good one. They are not too expensive and give you a good balance between ride height, comfort, and handling.