I do this alot.
Basically the most common way is a piece of software called VAG-COM from ross-tech.
This is a great fully functional piece of software that does many things. you really need to look at the website for the full list of features.
the diagnostic port is on the below the headlight switches behind a panel. just use a screwdriver to get this off.
It is a typical ODB2 port that all VW cars use, but as its based on the Mk5 platform you need to get a CAN-BUS compatible cable.
Rosstech do a CAN-BUS only lead on there webstore, this also contains the software licence embedded. This costs $249 and well worth it. Nows the best time to purchase from the USA as well!
for example you can:
read, graph, and log, a huge amount of sensors on the car. must be around 100 different ones.
you can read and clear error codes on the car ECU
Gain other info abut the car
Change settings in the ECU for car features like, weight of power steering and how the doors lock.
You can also run diagnotic tests on the car.
well worth the money.