The MK1 intake manifold is the biggest restriction in the intake system. Replacing the intake manifold with a ported gasket matched intake manifold will help free air flow. Especially if a upgrade cam will be installed.
First upgrade should be replacing the throttle body with larger secondary butterfly, where the secondary butterfly measures 52mm. The stock throttle body's secondary butterfly measures 44mm. The most popular upgrade throttle bodies are from the Neuspeed, Audi 5000 or Volkswagen Golf II. The donor models and years are:
The throttle body opening of stock intake manifold(MK1) is not large enough to allow the larger throttle body to open all the way. However the bolts are exactly the same location. So for the new throttle body to mount correctly the intake manifold throttle body opening location needs to be opened up a bit. Using a MK2 throttle body gasket as a template the opening can be enlarged with a Dremel or other rotary tool. Fact some online parts retailers don't carry the old style A1 gaskets anymore since the MK2 will work for both applications.
Picture of a 91 FOX throttle body that has been converted to work on the MK1 platform. The conversion includes, removing the primary butterfly and shaft from the MK1 unit and installing it on the FOX or equilavent 52mm throttle body. This conversion is necessary because the FOX and other throttle body cable attachments are different. Other more simple parts of the conversion is blocking off unused vacuum ports and installing the long stem idle screw from the MK1 throttle body. The long stem idle screw makes it easy to adjust the idle when every thing is installed. Make sure that the throttle body has a toggle bolt on the top of the secondary butterfly that's needed to close the WOT(Wide Open switch) when the throttle is %80 or greater open.
Stock MK1 throttle body. Bottom throttle body in picture is from a rabbit GTI.
The exhaust manifold for MK1 cars manufactured 1983 and newer have a very bad 4 -into - 1 design that doesn't flow all that well.
The 83-84 manifold is called the "toilet bowl", because of the obvious resemblance of the collar.
The reason VW changed the design to the "toilet-bowl", was to reduce breakage of the exhaust components that flex. Apparently, the braided flex connector just before the catalytic converter, that VW used on earlier designs, was not getting the job done.
Anyone who has tried to remove the toilet-bowl clamps without benefit of a special tool of sorts should agree that the headache alone of removal of this beast justifies adoption of the dual setup, and sale of the old setup to some hapless Ebayer.
The previous years 82 and older with fuel injection have a good manifold design of 4 - into 2 design that then feeds a dual down pipe that then transitions into 1 pipe just before the cat. Some rabbit/cabby diesels also have the 4 into 2 manifold design(dual outlet manifold) that can be used on the MK1 8v motor.
The 1981 diesel manifolds, and earlier, do not have an O2 sensor hole and therefore are less prone to the cracking that tends to occur there.
Other provisions for a O2 sensor are needed, such as the dual down pipe from Techtonics with the O2 plug in it.
After market dual downpipes are constructed to "give" a little more than the OE rigid downpipes. This "give" is done by a crimped collars on the pipes off the flange.
If you need the O2 sensor for your injection, use the one with the O2 sensor. For the down pipe, use the one that's least rusted.
Also, check the manifolds for cracks and leaks. About 2 out of 3 will have cracks and leak badly and are truly junk. If you are buying a manifold with the downpipe attached, beware: you might not be able to see the common crack around the O2 sensor hole. Look for donors that still have both lower braces on the downpipe. There's one brace that goes over to the transmission mount, and a curved brace that goes forward to the engine block. Obviously, pull the braces and install them with your "new" manifold and downpipe. Without the bracing, the manifold and/or downpipe will crack very quickly.
When replacing the stock 4 into 1 manifold(toilet bowl exhaust manifold) with the dual outlet manifold it may also be time to replace the rest of the aging exhaust system. When replacing the exhaust system pay close attention to the replacement pipe diameter. 2" pipe is the recommended size for a 1.8 liter motor with out a turbo. Manufactures such as Techtonices and Autotech have reasonable performance systems at a reasonable price.
Techtonics sells a stainless steel dual down pipe that has Scirocco 16V flex-joints built in the tubes. It is made for the A1 cars and uses the A2 dual manifold that came on mk2 8v GTI and GLI's. This manifold is still available as a new part, unlike the MK1 dual outlet manifolds.
Delete the AC if it doesn't work and it has no chance of being fixed. Reducing overall car weight is just as good as adding HP. The AC compressor and mounts weigh close to 50 lbs. The AC being spun adds to the rotational mass, making it harder for the motor to spin and rev, even if the AC is off.
With a HP to weight ratio of about 1:18, the AC costs you about a little more than 2 HP just sitting there!
To complete the removal you will need a new water pump pulley, new crank shaft pulley(not the timing belt pulley)a new water pump accessory belt and a new alternator mount.
Suggested downer cars:
Fox without AC: You'll need the water pump pulley, crank pully, and alternator mount.
Other Non AC equipped MK1 cars.
Once complete you'll need to measure the lenght for the new belt as it will not be stock length.
VWVortex link 
DIY Write up
Few common places to get a VW SOHC 8v adjustable cam gear/sprocket. Autotech, Techtonics tuning, rabbitparts.com. An adjustable cam sprocket will allow you to move the torque curve of the engine around (higher rpm or lower rpm) by altering the timing of valve events. Motor turns clock wise... so adjusting the cam adjusting sprocket counterclockwise will cause all cam related events to happen a slight bit sooner (ie advancing it). Or put another way - Advancing the timing of the valve events (turn sprocket counterclockwise) intake valve opens sooner, and the exhaust valve closes sooner putting more torque at lower rpms.
Retarding the cam (turning the cam gear clockwise) does just the opposite to the timing events- putting the torque at the higher rpm range.
Where to most VW owners put their cam gear timing at?
For street driving about 2 degrees retarded.
For other types of driving where high rpms are common the 2 degrees advanced
Your mileage will vary depending on what cam and other modifications you have installed.
For the stock engine the OEM specified spark plug is usually the best choice. However once you start modifiying the engine a different sparkplug may be needed.
The spark plug has two primary functions:
Good resource to check out when picking out spark plugs.