My first ever post on this forum was pretty similar to the above, and I have learnt A LOT about the right way to go about stereo upgrades on A2s.
So to answer, I will pose a separate question - what do YOU want the stereo to be?
- Sound better
- Be more convenient (Play MP3s etc)
- Have better display (SatNav etc)
Each requires different budgets and considerations. I've experienced myself how going down the wrong route can be costly, and without advise/experience you will end up with a compromise.
For example, people often end up changing the head unit to a non-Audi one because they want the MP3 convenience. This is (usually) disastrous for the sound quality.
Or I've seen people spending thousands on upgrading speakers/amps and adding subs etc, what they get is a big ol' mess of a boot, and hacked door cards - whereas a few hundred pounds will get you a BOSE system which in terms of sound quality is (for most at least) night and day over the already quite good sounding Audi OEM system.