It sounds to me like the lock mechanism failed similar to a failure in my 06 Jetta. I had to buy a new one and switch it out. My guess is that you will need to do that as well, but don't worry about having to have keys reprogrammed, as there is nothing in the mechanism you need to replace that requires it. There exists good write ups about how to replace the lock, with the biggest problem being getting two bolts loose that were intentionally designed to make them quite difficult to remove.
Key will only come out 2/3 of the way and then it is stuck. Don't want to force the issue because the car is drivable as is. I thought the lock mechanism was the tumbler assembly. Dealer says $111 to get one programmed and shipped from Germany and $150 to put it in. I've done ignition switches and lock cylinders in B4 and B3 cars, but not a newer electronic one. What part did you buy to solve this problem? Thanks!