The Audi 2.0l bottom ends are like rocking horse sh*t at the moment - I'm looking for one at the moment.
If you can find a shagged old one, the price for a new block from VW is about £900 plus the VAT on exchange. £700 for the rebuild sounds alright though.
As for power, I'm currently running a Pack A head (polished and ported), shrick cams, new injectors, stainless manifold / exhaust, K&N and lightened flywheel, which is currently pushing 170bhp - i've been told this could be nudging 200bhp with the 2.0 bottom end, so 25-30bhp.