The latch should be adjustable if you remove the trims around it and find the bolts - they are special fitment and require a specific tool to loosen them, or it has worn to the point it needs replacing.
VW transmissions are seal and only take a special type of transmission fluid. Need to buy the correct type of fluid from your local VW dealer.
As for this being your problem, might want to verify first by checking to see if you have any codes in the transmission control module or the engine control module.
Hi before you do an oil change try seafoam in the engine oil. this can sometimes fix the problems you are having, I used seafoam in engine oil and fuel and breather line and ran engine for 100 miles, but don't run hard, and its cleaned all the sump and oil veins in the engine, as checked with a scope looking though the oil sump plug. it did a really good job, my engine is a bit older than yours 1994. oil sensor is at the bottom of the engine on the sump. pressure sensor is above the oil filter it has a single wire conection
Improper fuel/air mixture, possibly plugged up air filter?
You have 2 out of 3 of the needed components for that motor to run, and assuming your timing is correct and you have compression, it could be an air intake issue.
Relay #4 you can look at it here http://www.bbbind.com/free_tsb.html
enter your vehicle info . year , make , model and engine . Under system click on electrical distribution , then under subsystem click on relay .Then click search ,two blue links will pop up . Click on the top one . Good luck ,hope this helps and GOD bless .
The ABS control unit is failing, this is a very common issue with the 98 and 99 model Passats. You will need to have the ABS control unit replaced. You can now purchase the ABS control unit by itself but it is still pricey. Depending on which pump you have will determine which control unit you need to get. The run around $600 - $750.00 plus labor to install. The control unit needs to be installed by some one with a factory type scanner, as the new unit will need to be coded for that vehicle.