Engine oil PENNZOIL or OEM Volkswagen

Given that it's almost guaranteed that this was not a turbo engine originally (the lack of factory air filter is another clue) she'll run hotter than usual and so a quality oil is a good investment.

i run 0w30 in my jetta 2.0. fully synth. have for 33,000 miles, no problems, other then better gas mileage

That is my personal favorite so far. Use or burn less than anything else I have tried, and I swear the engine sounds quieter. Previously used Castrol, Amsoil, Mobil 1.

Personally I use 8-10k change intervals on my Jetta, its rated for that, and i use the right oil.

I just picked up some Penzoil synthetic 5w-40 today and right on the front of the bottle it says "Meets BMW and Mercedes requirements" a little search on back label listed all the specs and all VW specs listed above are on the back of the bottle.