I'm afraid its only a sign of the times. VW is trying to make the cheapest, most efficient, vehicle it can. They are putting their limited money into driver aids and technology gizmos, not power output and driving dynamics.
Most people have no idea what engine is under the hood of their car. They don't really care beyond it starting, accelerating fast, getting good gas mileage, and not breaking down.
I guess the real question is: can VW make Golfs or Jettas that appeal to their traditional buyers, while they simultaneously capture the interest of people who would normally buy Civics and Corollas?