I've got the 1.6 and am very pleased with it. It's peppy enough - a little slow off the line because of the weight, but fine once you move up the gears. 0-60 is 10.9 secs, which is fine if you ask me.
Diesels cost more second hand, so with £2.5k you're going to struggle to get a 110TDI with less than 115,000 on the clock. Yes, diesels last longer, but it's not necessarily the engine that's the weak area - remember every other component has done 115,000 miles as well.
The 110 is a nice engine (I drove one a few years back), but for your price range the 90hp TDI is more likely, unless you want galactic mileage.
If I were you and with your budget, I'd recommend a 1.6S with 65,000 on the clock.