In a word excellent!
I have towed with a 57 plate vRS TDi Estate with the older PD engine and now an 09 plate vRS TDi Hatch with the new Common Rail engine.
The common rail engine has the edge for economy and smoothness, it is better for pulling away when towing as it delivers the power more evenly, that said the old PD engine coped very well.
Stability from both has been excellent. Traction has not been a problem despite so much power going through the front wheels ... albeit neither has had to content with a wet grass pitch.
I did 30000 miles in the first car (5000 ish towing) in 18 months. I have done almost 14000 in the current car in just under 8 months (3000 towing). Neither has let me down. The only thing the origonal one cost me was a set of front tyres at about 26000 miles. NB both mine came with three free services.
I would certainly have another one ... but chances are we'll go for something bigger as we have a new 'van on order that will be pushing the weight limits.
If I can give you more specific info just shout!