As it turned out, the problem with the brakes were the rear wheel cylinders, both were seeping brake fluid, causing the loss of pressure.
Got the exhaust tightened up and quiet up front with a custom pipe fabrication.
I got the car registered and inspected, and drove it all around town for the first time! Gotta say, it's a fun little car- and even more fun because of the process I went through to make it work!! I'd ilke to thank all that helped along the way- Steven (From england), Gordon (From Scotland), Douwe (From the Netherlands), Cullen (www.eurocullen.com), EuroCarParts.com, Jim (Here in the US), The folks on the Porka.net and UKPolos forums, and all the folks on the polo-l and pologt mailing lists, Jaap (Netherlands), Nigel (The UK), and the other folks who emailed me about the "Öko-Polo" and provided me with so much valuable information, and anyone else I may be forgetting. As always, feel free to email me comments on the car.
Which reminds me follow this link to learn more about the "Öko-Polo" (Eco-Polo in English)
The Liscence Plate is a NH environmental conservation plate,
and will read
"ECO-VW"
Thanks again to all, and for following the progress on this project!