MK2 hubs are different from MK1, the arm on the hub that the track rod end goes onto is at a different height. MK1 racks are mounted higher and the arm is in the centre plane of the hub, mk2 have the arm about the same height as the top of the bbj mount. Would not recommend the route for a brake upgrade, use the 16v discs and callipers with some adapters.
Steve.