Ive always used GSF for their Mann oil filters, and then picked up comma semi-synthetic 15w-40 at a local parts supplier for my GTi 8v. I go with an inexpensive oil (so long as it meets the usual quality standards) , as that way I can afford to change it more often. Expensive race oils like Silkolene etc would be nice, but are often over twice the price, and its not really a super high performance engine. More frequent changes are beneficial in any engine, but particularly an older one. I do around 4000 miles between changes, but driving style and conditions should influence when you feel it prudent for fresh fluids. Consider using an engine flush when doing an oil change, especially if the old oil is a bit filthy. Now that i change oil regularly, I dont use a flush, as its a further expense (again, the cheaper it is, the more often it can be done).
Consider checking and cleaning the rocker cover breather while your at it, I recently found mine to be filthy, so a clean may help. A simple clean of you carb would be helpful too.
New plugs are inexpensive and easy.
Fresh gearbox oil may be a good idea, as it may have never been changed.
That would give a good start to a car refreshing service.
Performance mods... A good set of new sport's tyres. I dont know what to recommend, ive got yokohama s-drives just now, and love them. Cheap enough for smaller standard rim sizes too. The best place to start.
If its a 1.6- it may not have a front anti roll bar- you could fit one from a GTi- that would improve road holding.
GTi brakes for better stpping.
When your ready for more power, I think a GTi cam can be fitted to a 1.6, and a weber twin choke carb is a nice improvment over the standard pooberg one...