Possible its on its way out but before you worry to much about a new engine theres a few other things it could be.
A squeak from the cam belt area could be a few things, Worn water pump bearings spring to mind, are you sure its not from the aux drive belt? try to get a bit of WD40 in behind the pulleys be carefull to avoid the cam belt, see if that gets rid of it.
As for the tappets, they use hydraulic lifters which can knock very heavily sometimes, they will get louder when you apply a load to the engine. If they are knocking try an oil change and flush first then put in new oil with a bottle of wynns hydraulic lifter treatment, that will help cure your tappity tappits. if it comes back or doesnt help you will need a new set of lifters (£25 on ebay)
As for the performance issue, that could be something quite simple, or mabey not so simple, If your Lifters a very badly damaged it will fail to open the valves correctly which in turn will effect the performance. My 1.4L golf has a very very bad lifter and indeed sounds like a diesel all the time but i know its the lifter and im not to worried about it.
Give those things a go, just out of chance it might cause the problems. Lifters can be an issue on the golf so once they are sorted you should find she runs allot quiter and smoother.
