Okay - I checked the R134A level and it was okay, but I added some more just to be safe - no change.  Car still had vibration when AC was turned on.  Took it to a local VW dealer who works on Audi's and they replaced the "Expansion Valve" in the AC Circuit. This is an aluminum block like device near the front suspension strut tower going into the evaporator.  There were 4 o'rings that get replaced also, along with a drain and refill of Refrigerant.  Got out of there for $350 with a 12% coupon that the wife had.

AC works fine now.  Set on 63F, nice and cool!

I think the wife actually had the same part replaced on her 04 Passat 1.8L.  So it may be a common problem for this engine.

Thanks for the comments.  Nice to bounce ideas off others with similar situations. 

Larry

Good to know, in case mine ever gets worse .