So, in case anyone is interested, the brake pad sensor works as follows:
The sensor has a wire that goes into, and then back out of, the pad. It is embedded in the wear portion of the brake pad. As the pad wears down, eventually the wire becomes exposed and gets worn thru (i.e. broken) from pad wear. This opens the electrical circuit, and turns on the brake pad sensor light on the dash. The wire gets broken when there is approx 3/16" of pad left (quite a lot in my book). Only the driver’s side has the sensor on it, so it is really VWs way of telling you to look at the pads. Kinda silly really, since the rear pads normally wear out long before front pads on the Golf's.
New set of front, sensor equipped brake pads are $80.00 at the dealer (I didn’t have time to buy from germanautoparts.com). That’s pretty expensive, but they do have an enormous amount of pad thickness when new. My front pads lasted 150,000 miles, but that's really an indication of how much highway driving I do.
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