There are two methods for adjusting the air-fuel mixture on a CIS- Lambda fuel injection system such as found on VW A1 GTIs and pre-'90 Cabriolets. Both will get you reasonably well-adjusted but in reality they should be done together. CIS-Basic systems found on earlier Rabbits/Pickups/Cabbys can use the non-dwell meter method alone for proper adjustment.
WARNING! If you haven't verified that the engine is properly timed, tuned up, etc. the following adjustments may make it run better but won't cure other problems and MAY actually make it run worse.
STEP 1. Unplug the O2 sensor. There is a inline connector that will allow you to do that. Warm up the engine until the fan has run twice. (This step obviously assumes you have an engine that is running. Dead engines need not apply.) Insert a 3mm long allen wrench in to the hole indicated in the picture. If you like the fancy T-handle type of wrench you can spend lots of bucks on a metric wrench or get a $2.50 7/64" wrench at the local hardware store.
STEP 2. Begin adjusting the airplate a 1/16th of a turn counterclockwise at a time. This is slowly leaning out the mixture. At some point (and it may be a while) the idle will start to drop. (At this point we want to remove the wrench between tweakings since the weight of the wrench may affect the drop of the airplate. Put the wrench back in and tweak again. Repeat the process.) If not sure if the idle is changing blip the throttle a small bit to reestablish an idle point (this makes the airplate move and breaks any friction stickiness that may be resisting your changes). When you believe you've heard the idle drop then adjust in the opposite direction (clockwise to richen) to richen the mixture. The idle should now rise. Repeat the adjustment to verify that you are at the "Lean Idle Drop" (official mechanics phrase). Set to just a bit richer than the drop point. That will have you set about as accurately as you can get without actually using a tail pipe sniffer or dwell /duty cycle meter to verify it. You may need to reset the idle when this is done.
STEP 3. Remove the friggin' Allen wrench. It won't hurt anything but it'll reduce your rev range when the wrench hits the hood and won't rise anymore (Don't ask how I know this.)
STEP 4. There is no step 4.
This picture was taken after using the "non-dwell meter" adjustment method. The duty-cycle was read after re-connecting the O2 sensor. Notice how close we were able to get the adjustment.
"Using a dwell meter" section.
The O2 sensor on a Lambda system will compensate for any changes you make with the airflow plate which is why it should be disconnected before using the manual adjustment method on a Lambda system. As you tweak it lean the O2 sensor will compensate and enrichen the mixture. Tweak it rich and it'll lean out the mixture. If your baseline adjustment is off you can drive yourself nuts chasing the proper setting. Since we've already established that we are "close" due to the previous adjustment we can now hook up the O2 sensor and finish out checking our mixture.
Background: The O2 sensor senses the 'richness" of the mixture and reports to the ECU. The ECU then changes the duty cycle
of the frequency valve to adjust fuel pressure to a part of the fuel distributor which in turn changes the volume of fuel flowing from the injectors and therefore the "richness/leaness" of the mixture. A bad O2 sensor will throw off the mixture severely. A cold 02 sensor will too which is why we thoroughly warm up the engine before making these adjustments.
STEP 1. Hook the O2 sensor back up.
STEP 2. Warm up the engine until the fan has run twice. This ensures that the O2 sensor is thoroughly warmed up which is necessary to proper operation.
STEP 3. Hook up a dwell meter or a duty-cycle meter to the ECU test connector. If the engine is running you should have a reading that is around 50% (or 45 degrees on a dwell meter). If your engine has a Wide Open Throttle switch on the throttle body press it and se if the duty cycle changes (it should). The reading will either be 65% or 35%. If it's 35% then you need to reverse the meter test leads on the test connector. This is because some meters (such as those from Radio Shack) read the signal differently than others. (it is possible you won't have a WOT switch. Some models don't. It is possible that the reading could be as high as 80% when activated due to some ECUs.)
STEP 4. (yes there IS a step 4) Adjust the mixture screw as in the above procedure so you are reading between 45% and 55%. This number will "float" as the O2 sensor keeps adjusting the mixture so be patient.
STEP 5. You are now adjusted. Remove the friggin' Allen wrench.
If your initial readings with the O2 sensor connected are waaay off then it's likely that something is causing the mixture to go bad. Causes could be a vacuum leak causing a leaness which will show up as a "rich" (>50%) reading on the meter (the ECU is trying to compensate) or a clogged cat/exhaust showing up as a lean reading (<50%). Dribbling/poorly spraying injectors can cause a system to get rich as well. Clogged fuel filters or injectors can cause a lean condition. Waaaay-off readings can be due to a bad O2 sensor.
As you saw the manual method puts you in the ballpark and if you're careful will nail the adjustment quite well without any use of the duty cycle meter. If you have a meter you'll be able to get even closer.
To adjust the airflow plate rich or lean affects the entire airflow/rev range. So a" richer" setting here means richer thru out the powerband. Ditto with lean settings. Never adjust the airflow plate to change the idle. The idle adjustment is on the back of the throttle body. Anytime you change system pressure thru a new pump install, filter change, injectors, fuel distributor etc. the mixture adjustment should be checked.
Why is the manual adjustment method so important? Because it will set the mixture well for those times when the O2 sensor isn't working i.e. warm up and cold running. The ECU cuts the O2 sensor out of the adjustment circuits until the coolant temp is above 77°F . This is known as Open-Loop running. It is assumed that the O2 sensor is not yet warmed up and will give bad readings until it is. Closed-Loop running is when the ECU & O2 sensor is actively adjusting the mixture on the fly. I've seen an otherwise good running engine catch start quicker because the mixture was set a bit richer than usual. Then when warm the O2 sensor takes over and leans the engine out just as needed. best of both worlds.