I have got a mk3 early 2.0 TDDI and a mk4 1.8 TDCI.
The MK3 TDDI is the same engine as your TDCI, however without the fancy fuel injection that plagues the later tdci.
My Mk4 1.8 is the single cam old Endura engine that Ford have been using for years. It's a bullet proof, reliable engine. It does have a modern injection system however Ford seem to have ironed out the mk3's issues so you shouldn't see them with a mk4. It returns between 53 - 56mpg on a steady run, I currently average 51.7mpg with daily use, an £100 fill up will get you about 700 miles. The 2.0 and 2.2 tdci's are peuget engines, and do suffer a few mechanical issues, the 1.8 is supposed to be the most reliable of the bunch.
I do however prefer driving my older mk3, yes it rattles and knocks a bit more but it is a bit more of an involving car to drive, seems a bit livelier, the mk4 just feels a bit detached from the road if you get what I mean.