If that is from a main dealer, then I'd say that price is not bad at all.
I was at my local dealership on friday, and they had a 2001 non Turbo GTi with 30k miles at ?13.5k
Bare in mind these were less than ?17k new, they're still holding a tremendous percentage of their original value.
Just because the Mk 5's are out, don't assume the values will freefall - sure, as Mk5's start to flood the used market that will affect Mk4 values, but that will not happen for at least two years - remember, at present this is the latest golf available in the used market.
Early Mk4's and late Mk3's are still pulling respectable money for 7 year old cars, I wouldn't hesitate at buying a used Mk4. But when the dealer tells you he has no more money in the car, he's lying out of his ass - hammer him for more money, or alloys. Dealer fit wheels are expensive to retro purchase, so if you an get a set of of them, you've done well.