Hey, sorry for the delayed response.
michTDI: I'm not sure if I can help you or not, but I'll give you a suggestion or two. I would think that reconnecting the new pad wear sensor should do it, but since it isn't, I'd fiddle with VAG-COM. As Radman indicates, you can disable the idiot light in VAG-COM. Do this:
(1) Go into the Instruments section -> Recode. You have a 5-digit number in there. Write it down. Note the first two digits. Probably you have "07" as that's what most N. American cars have, I think.
(2) Subtract 01 from the first two digits and enter the new number in. So, if you had "07xyz" before, you should type in "06xyz" now. Then save.
(3) Exit VAG-COM.
(4) Did the idiot light go out? If not, I don't know what's going on, and the problem is beyond me. If so, go back into VAG-COM and undo what you just did. I.e., change "06xyz" back to "07xyz" and save.
(5) Did the idiot light come back on? If so, you have a bad connection. If not, great! We're done!
Here's the scoop. The first two digits of the cluster's code give you control over the idiot lights and alarms. They are given by the following:
00 = No equipment coding
+01 = Brake wear sensor alarm
+02 = Seatbelt warning
+04 = Washer fluid warning
Add them all to get 07, which means your cluster will alarm you if any of these sensors trip. Subtract 01, and you've disabled the brake wear sensor.
I hope that helps.
-Brian