Defo get the water temp sensor replaced, its the 4 pin one in the plastic flange on the front of the block, will cost about £30 from VW. Dead easy to swap, but only do it when the engine is stone cold, or coolant will spray everywhere!
Also, do you know what make of lambda was fitted? I got a cheapo one off ebay and it only lasted a month, replaced it with a bosch universal one and its been fine ever since.
Its possible the coolant sensor is making the engine run too rich, and is killing your lambda!