Morning guys, sorry been away all week. OK, official answer from my dealer is that the MDI was removed due to the telephone prep but said the ipod by USB should still work, and I was then asked to contact VW direct.
So I did, and got through to the MD's office as he was covering for customer services. Very nice chap who fully understood my complaint and agreed the brochure was lacking in information over the extra and that it doesn't state the MDI is removed.
He himself is a mk7 driver, though not GTI, and says he couldn't live without his ipod in the car either. So he was personally going to find out about this one and get back to me. He's due to speak to the factory today to get the low down and confirm whether it can be retro fitted or not. He's also confirming the connectivity options for the front USB port and what can be used in it. So watch this space!
On another note, the prep actually works! Where I normally lose a call 3-4 times on the way home in the same places, I didn't lose it once. The call stayed connected for the whole 20 miles and on one night I even took a detour out to Sherwood Forest where I have before had no coverage for a whole 5 mins and it stayed connected. So it works, and I have to say I think it is worth it. But that's my opinion, and I know others will think differently.

Anyway, I will update as soon as I hear back from VW HO.