I stumbled on to this last week over on TDIClub. The whole idea is the pet project of the founder of FFR. His DD is a TDI wagon he runs on bioD and had the inkling to develop a high MPG mid-engine car using the Lotus creed (less is more), but building the car so as it could realistically work as a DD.
The pic is a photochopped GTM. The actual body design style is still up in the air for debate... thoughts of a 904/Dino look have also been floating around.
While his prototype car will be based on a TDI (he already has an ebay sourced car that he's started taking apart), the final kits would be designed to take any MkIV engine, 1.8T, VR6 or even a 2.slow if so desired...
His intent is to use as much of the MkIV - particularly the floor pan and dash board (and thus the VW VIN), basically so the car could be registered as a reconstructed VW (state laws will obviously vary...).
He's hoping to have the final car weight at around 2000 lbs and the kit price at around $10K. The weight I can see happening... but given the price of a Cobra kit and the additional content required for a DD, I'm not sure about the price.
I've been pressing him to have something to show at the Carlisle import & kit car show in 2010.