sell it and by a Cooper S......lol cooper S makes a prelude look like a wallowy fat mans coupe, eh Davels
serious go-kart thrills!
But Seriously i would repeat what others say and look at coil overs as the most cost effective means, other than that, but a different car is the only real option. If you think you can better what cost SEAT millions to develope in a short trip to halfords you will be sorely disappointed. you can only build on it.
If you want a serious handler you buy what are recognised as the best FWD handlers, ie, Mini, clio 172 cup, Civic type-r or integra. sorry,
Also not sure the LSD would revoloutionise the handling too much, will be much better for getting traction down and solving the silly understeer you get on the higher torqued 1.8T's and TDi cupra's. But 1200 quid is a lot of money to add on top of money spent on engine mods and price of car etc.
An LSD will transform the car but it's not cheap, I think the Jabba ARB is fantastic addition as it stops some of the rear end rolly polly feel drop it a little on coilovers as well and it will be a good combination. Just remember that you get more grip with a softer more complient setup than a hard bone shaker.