sorry but i have to disagree...
40mm on 205/17's wont be a problem.... mine is 40mm on 215/40/17's which have a slightly larger rolling diameter than the 205's would, and ive got a boot full of sound system, and had 4 other people in the car with no scrubbing.... and thats with 8.5" wide wheels

in fact u can lower mk3's (well gti's at least) about 60mm and still have 17" wheels with very little problems.
the offset does dictate some of that, if u stick to around 35 - 38, then u shouldnt have any problems.