I've just heard back from VW, who have confirmed that they will make a 50% contribution towards the repair and repainting of both sills, at a cost of £452 to me. I had originally thought this was excessive and looked elsewhere, but both body shops I visited quoted me £500 for the same job.
I decided to chose the VW option, mainly because I felt it would add to the credibility of my car when I come to sell it. I know some people have a low option of VW workmanship, but deciding between a independent Body shop and VW, a potential buyer would, on the whole, most would prefer to see a VW badge against the work.