[Pseudotropheus]

AEG dont technically have a PCV system. However, what you are looking at is the equivalent to the AEG PCV system.

Firstly, that black round cylinder. Unscrew it from the top of the valve cover, and clean it out. The hose that all the gunk is in, replace it! Oil eats rubber, any petroleum based product will eat rubber. That tiny hose with the lil' bend in it ranges from 15-30 bux.

Surprisingly, that "yellow" sludgy stuff your seeing, is completely normal on the Beetle, you are the 10 millionth person to find that nasty stuff. That is caused by condensation mixed with the oil residue. For the most part, its normal. However, if the hose gets clogged, it wont breathe properly. Need to replace ASAP. it is normal for a little bit of oil to go through that hose.

Next, take off your intake piping. You need to look in there, and see if there is this same sludgy build up inside the air intake piping. If that is clean, everything should be ok. if it is not, you have a problem.

Also, when you change the oil, if you see this stuff, any amount flowing out of the drain plug, this means you have a "major" sludge issue.

Here's the thing, I assume you havent been using synthetic. Synthetic will eat away sludge over a period of time of use. However, if you have used conventional the sludge has built up around your seals and may have eaten them away, and now the sludge is acting like a seal. If you take away the seal, you get massive oil leak. Be careful since you havent run it on 100% synthetic. It wont happen with one use, but constant use for a period of time could result in what I said above.

if you dont want to use and spend the money on synthetic.
Get the synthetic blends, the molecules are more refined they are smaller, and will last longer, and still eat at the sludge little bit by little bit. Synthetic blends are actually really good oils, not as good as synthetic but "way" better then conventional.

I just replaced mine a few weeks ago, hose was squishy and eating away from the inside out. Judging by the pics, your is much worse then mine. This may not fix your problem, there maybe another cause however, clean it out and get a new hose!

I need more details, pics, counds etc... to try and diagnose over the net. I know its hard to believe that the "yellow" stuff is normal, for a few weeks I denied its existence as normal. So I went to 2 VW customization shops been in business for a combined 70 years, and went to a dealer.

BTW the hose at the dealer is 30 bux. Anywhere else its 15...