yep, mk2 gtis in my opinion are the best ones, power to weight ratio and their handling characteristics are so much better than mk3s and mk4s.
I think you would get bored of a 1.4 very quickly, if its insurance that your worried about, have a chat with martinb on here, he works for HIC and they can sort pretty good prices, when it comes for my renewal, I will be calling him about it. I have a mk2 GTI 8v, and is the funnest (if thats a word) car I have driven, I paid £750 for TPFT insurance and I'm 20, so it isn't too bad.
Remember, with the refinements they gave the mk3, they gained loads of weight.
Try to look at and drive a mk3 GTI, and you'll find its a much quicker, more involving drive than the 1.4. With better suspension the mk3s come a little closer to mk2s in terms of handling too.