You won't know the transaxle case condition until you clean it up. It can look all crusty (like yours does) and be fine (all the sealing surfaces still good) , or as people have said, be so corroded that the bottom is eaten away and/or the sealing surfaces are gone (again, at the bottom). I have heard of people using a liquid metal type epoxy to fix small areas around the drain plate on engine cases, so if the areas are small I imagine it would work here as well.
Re 4.12 vs 3.88 r&p- If you want your car to be more zippy around town and have a smaller engine (sub 2 liter) then keep the 4.12. If you see yourself as more of a tourer, doing huge highway miles on a regular basis then the 3.88 may be the better way to go. It all depends on what you want, and if you want it all, now you're talking about joining The Way OF 5. You just have to open your wallet really big, but The Way OF 5 is amazing, and it will transform you. Just ask Mitch- after becoming a member of The Way he now looks amazingly like Brad Pitt- it's truly amazing!
When VW went to the 3.88 they also shortened 4th gear from 0.89 to 0.93 in the Beetles, as the 1600 now overheated at highway speeds due to it's poor aerodynamics. This combo is almost exactly the same final drive as the 4.12/0.89 (3.66 vs 3.60 for 3.88/0.93). The Karmann Ghia, with it's slipperier shape, kept the longer 4th gear with the r&p change, going to a 3.45 final drive.
And don't hold your breath hoping to run into an AU transaxle- no Volkswagens were ever brought into Canada or USA with a ZF limited slip differential by the factory. As Danny said, in these 2 countries they are as rare as hen's teeth. Al