The Audi A4 1.8T received a 6-speed manual transmission for 2004, so no more 130mph-limiting 5-speed. The 1.8T is rather slow in stock form (but fun to drive with a manual tranny), but it can be modded heavily. But when you mod it, there is no doubt you sacrifice engine life (I used to want an A4 1.8T, I've read a TON of things on modding the 1.8T engine).
Better off going with an M3 than modding an A4 1.8T if you have the $$ for the initial investment.