I quite like it, although I do agree about the engine swap. If you're gonna do a Mk3 into Mk1 engine swap, why not do it properly.
I'm after a non-GTI Mk1, so if I got it, I'd run it as is for a while then swap to a nicer engine. If it's already got the Mk3 mounts, would a Mk3 8v fit it?
Hmmmmmmm......