Well, I got my car back from the dealership today- man it is a different vehicle! They replaced the BS with the VW gear driven assembly, did the timing chain, tensioner and water pump while they were in there, replaced the 4 glow plugs and did the reflash, replaced the front cv boots, gave it a 4 wheel alignment and even replaced the windshield they apparently cracked while working on the car - my total cost was $1657.00. The fact that the car is torn down so completely to do this work results in an a/c evacuation and recharge which is a good thing as well, not to mention the free oil change and coolant flush.
The car is dramatically smoother - it now sounds much more like my wife's 06 Jetta TDI at idle. My dealership, Fifth Avenue Auto Haus, says that they are now aware of the BS issue and are actively telling their customers with the model to come in to have it checked out and replaced if necessary under warranty. The notes on my invoice state they heard "heavy vibration" at idle and found "play in the balance shafts" when they pulled the oil pan. The "Tech Help Line" apparently advised to "update oil pump module with gear driven assembly". If any Passat TDIs are around Calgary, I would suggest approaching this dealership since they seem very aware of the issue and willing to address it. I am more than pleased with the service I have gotten there.