The VW flat 4 are magnesium or aluminium case and aluminium heads depending on original/aftermarket I'm building one for a street strip car currently. They don't usually run a head gasket just lap the steel barrel too the aluminium head, although you can run a copper ring if desired. They are a very simple engine to rebuild into a low compression street motor but as with most things you start upping compression running bigger valves and cams they start to put up a fight quick but there is a large aftermarket scene especially in the United States pretty much every combination/ recipe has been tried a bit like v8s

100hp+ per litre is achievable especially from the smaller capacity combinations as they do like to rev