I've owned a lot of VWs over the years, as well as other kinds of cars, and just recently bought an new GTI after having been away from the VW world for about a decade. Here is my take on the reliability of all VWs, and most German cars for that matter, as opposed to Japanese cars.
German cars are very different from Japanese cars. It is like they are built around entirely different ideas of "reliability." Japanese cars will typically run a ridiculously long time, with hardly any maintenance at all, but then reach some magic point, where the car will just fall apart, requiring massive repairs, to the point that you are probably better off just replacing the car. It might go 175,000 miles without a single problem, but then the engine or transmission just blows up (figuratively), and there is nothing to do but replace it.
VWs, on the other hand, will run forever, but at the cost of a constant need for minor maintenance. A VW might well still be running great at 200,000 miles, but by then will have a new clutch, a new exhaust, a new alternator, and new CV joints. If you are the kind of person who gets a new car every few years, then you can't go wrong with either a German or Japanese car, because you will probably never see a major problem before you get rid of the car. If you are the kind of person who will trade out your car for a new one before you hit 100,000 miles, then you are probably far better off with a Japanese car, because the VW will start requiring some maintenance around 75,000 miles. If you are the kind of person who still loves driving your car, even though you have put 200,000 miles on it, then you are probably the kind of person who will appreciate VW's sort of reliability.
The story I always tell people about VW reliability, is the story of my mother. About 20 years ago, I convinced my mom to get a used VW. It already had about 75,000 miles on it, and she drove it for about 10 years. After 10 years, she got fed up with the constant nickel and dime repairs she had to keep making to the car (the most expensive repair was less than $500, and they were all minor enough repairs that she could drive the car to the mechanic to get it fixed), and got rid of the car, to buy a used Honda. For years she was so relieved not to have to constantly put money into the car. Now, 10 years after buying the Honda, all she can talk about is how much she misses the VW. The reason? A few years ago the Honda started having major problems, each one of them leaving her stranded, having to have the car towed, and each repair costing her closer to $1,000. Now, she really wishes she had that cranky VW, with its list of annoyances, that never left her stranded, never broke the bank, and that just refused to die, no matter how much she abused it.
I don't think either way of building a car is better or worse than the other, I think it just depends on the sort of person you are. When my wife and I were deciding what new car to get, we looked at tons of Japanese cars, but ultimately decided that we wanted to keep whatever car we bought for the next 20 years, so the choice ended up being a VW. Of course all of this is based on past experience with VWs. I haven't even had my new one a month, so I can't really comment on the reliability of it in specific. It still seems pretty much like all my old VWs in many ways though, so I don't expect it will be too different.
Hope that helps. Oh, and one word of warning. Take care of your dash! 20 years from now that will easily be the hardest part to find in good shape ;-)