How do you troubleshoot an irractic idle problem that sounds like it's going to kill?

First thing I would do is check the computer for trouble codes. You can look the process online. Look for OBD-1 Ford code retrieval.
Could be a dirty throttle body or a faulty idle air control valve among other things.

Sounds like a miss - is the check engine light on too ?

Idle Air Control sounds like its going bad. Check it first.

this is going to sound crazy BUT i would (and have) take your car to a skoda dealer, labour cost 1/2 that of audi(i worked for audi for 11 years)and the parts are out of the same box.have you replaced H.T.leads as thet are carbon fibre and can cause the same symptoms.also ask to speak to audi area technical manager when next in your area.he is factory trained.

DOHC? timing is out you need to check your cams and make sure it didnt jump a tooth when it was put back together

Check the Idle Air Ctrl (IAC) motor. It should allow air to bypass the throttle plate when starting and at idle. if it is not working it could cause veh. to stall.

The distributor shaft should not move from side to side. The tps has to be adjusted with a voltage meter to the correct settings. Plugs, wires, dist cap and rotor should be changed at the same time and this will eliminate any carbon tracking from wire to plug resulting in a misfire.

You need to replace your IAC (idle air control valve). The IAC, like it sounds, control the idle of your car. When they go bad they will cause the low idle and stalling. The IAC is located on the throttle body and is usually held on with a couple of screws. It is an easy relatively cheap fix that you can take care of by yourself. Let me know if you have any more questions. Thanks for rating my response and for using FixYa!

Have you tried replacing the fuel filter

Possible air leak take off engine covers and spray with wd40 whilst engine is running if idle increases and engine becomes less erractic then air leak is were you sprayed wd40 normally its a gasket gone