The MKIV (1999-2004.5) VW Jetta Wolfsburg Edition was offered during the 2001 and 2003 model years. Differences between the Wolfsburg Edition and GLS model it was based off of are as follows: 16" BBS RXII wheels, sport suspension, sport seats, leather 3 spoke steering wheel, leather wrapped shift knob, and leather wrapped emergency brake. These differences from the normal GLS are tremendous improvements. The improvements that the sport suspension or sport seats make alone are worth the additional cost in my opinion.
Minor variations between the 01's and 03's also existed such as the exhaust cutout (03), trunk spoiler(03), cup holder locations (center console for 01, between seats 03) , and color options. The 01's came in black, reflex silver, tornado red, and white. The 03's had the same color choices with the exception of tornado red swapped for galactic blue. Both model years offered a sunroof and monsoon sound system as options. Both came with a 5-speed manual transmission, which is far better than VW's automatic.
Both came with the same 1.8T engine, however, the 01's came with 150hp stock and the 03's with 180hp. The horsepower difference is from modifications made to the engine's ecu, or chip. Both versions are capable of much greater horsepower, but are limited to stagger VW's engine lineup. A simple chip reflash can make engines from either year produce 200+hp. This information can be useful when buying any pre-2002 VW with a 1.8T because the 150hp version will usually be sold at a lower price. A new chip (around $500) will give any 1.8T comparable or greater power to the stock VR6.
The only Wolfsburg specific problem is pitting on the OEM BBS RXII wheels. It is most common in areas that use salt on the roads during snow season. What happens is the clear coat on the polished lip allows salt and water to get under it, leaving behind spider web looking markings around the edge of the wheel. I have never heard of this effecting the wheels durability, but dealerships have been extremely reluctant to fix this even under warrantee. BBS will also not fix this under warantee because the RXII's (two-piece wheel) are unique to the MKIV Wolfsburg, unlike the standard RX (one-piece wheel).
The "sport" suspension is the same as the suspension included in the optional sport package. It lowers the car approximately 0.5mm - 0.8mm lower than stock. The only mechanical difference I'm aware of are stiffer springs, made by no particular suspension company. As an option, this would hardly be worth it, but since it comes on the Wolfsburg, it certainly is a major improvement over a stock Jetta GLS. The ride is not harsh by any means, and the lower stance of the car is not enough to adversely affect ground clearance. If nothing else, the car's ride height simply looks better and is more fun to drive than a regular GLS. I have been told that the US sport suspension was the European standard suspension, but because of US safety regulations, and consumer demand for comfort, all MKIV's were raised a bit and had softer springs for the US market.
Average gas mileage for the Wolfsburg is 28 mpg city, 34 mpg highway. It is recommended that 93 octane fuel be used with the 1.8T, as well as synthetic oil. The higher prices for these are discouraging, but anything less and gas mileage, horsepower, and reliability will suffer.
I personally own an 01 Wolfsburg and have not had any problems. In general though, Volkswagens have not had a great reputation for reliability, and the Wolfsburg is not exempt. The most common problems on the MKIV's being failed window regulators, random check engine lights, and problems with the mass airflow sensor.
The Jetta Wolfsburg is how the base Jetta really should have come equipped to begin in the US. With dealers charging a premium on used Wolfsburgs, it may not be a good choice when a similarly equipped GLS may be had for cheaper. But if the price is good, the Wolfsburg is a great special edition with all its added features.