Outsh... sounds like you got yourself a lemon...

let me guess, private seller? if local go there and ask how it passed the MOT with the airbag not working... although sounds outright dogy
if you want to go about fixing it, read the fault codes, that may tell you something more about what is wrong... best case it's only a wiring issue
your golf does not have a stand-alone "handbrake" warning light - it's a brake warning first and foremost, hence indicates something wrong with braking system, my guess fluid is low (by how this car was done up probably a leak....

)
handbrake can be adjusted but if the shoes need replacing that won't be much help for long.
If you can return it!!! If not think if you want to put a lot of money in it or not - if body is in GREAT condition for the age it may be worth if, if it suffers rust then pull the emergency brake and scap it... I got nearly 200£ from scrappy for my Variant in Worcs.