Check out Roger Lippmans website.
http://http://terrasol.home.igc.org/alky/alky-preface.htmHe has a booklet you can buy that covers converting cars to Ethanol and a section of the air-cooled VWs. I know the waterboxer is different, but it has some insight on what might fail as far as seals and what not.
Massachusetts had been running 10 percent Ethanol in their gas for years and I haven't noticed much of a difference in performance. I live close to Vermont and I occastionally get non- ethanol mixed gas.
I have noticed that there seems to be a higher failure rate of Catalytic converters. Here at the shop, we're doing almost one a day. I'm not sure its related to the alcohol or not.
I know I've had to replace the cats on all my cars. I figured it was just age. All my cars have high mileage. I previously owned serveral 1.9L Vanagons and golf. I currently have a Eurovan and a Jetta