We've had 3 tanks of 100% city streets and they have all averaged 32 +/-1 MPG. That has been with some cold mornings and the wife running the heated seats mostly in the mornings, but throughout the day as well. We also just did a 1300 mile trip up and down I-25 between ABQ and Cheyenne (some mountains, very little flat terrain) and averaged 40 MPG doing 80 MPH most of the time (I think the tank average speed was in the 70s).
I get panicked when I see 30's on the gauge while driving on the highway, but have to remind myself that the Passat isn't my Golf and high 30's is doing great. On some of the New Mexico roads, the Hankooks get noisy (not as bad as the Golf), but on the smooth roads in Colorado, its very quiet. After doing 3000 miles in the golf in October squeezed in with the wife and 2 car seats (I'm 6'1"), the Passat is an absolute joy for road trips. I can stretch out all the way in front of a rear-facing carseat and there is room to spare. Other parents (especially tall ones) will know what I am talking about.