They believe the leak was from the nut where the pipe meets the cooler on the passenger side although there is a really bad bit of rust on the top of the pipe as well. There was oil above the cooler but II guess with the air traveling through the front the oil could have ended up anywhere.
They couldn't get the pipe off of the cooler so it was a new cooler and both pipes replaced. I had already prepared myself for it as I had weighed up my options.
1) Book it at Audi and face the costs
2) Book it at MRC to do the work who had quoted £1000 - £1100 including the cooler but they can normally salvage the cooler so its normally a lot less
3) Do the work myself
When I booked it in I was talking to the guys there and when I explained I was pretty pi$$ed off about having to pay for a cooler that amounted to almost 50% of the total cost because of bad design. I'm more than happy to pay for the pipe and labour if that's what is faulty but to replace the cooler as well didn't sit well. They charged me for 2.5 hours labour instead of 5 and discounted the parts by 10%.
That helped as the price they quoted was the same as MRC and although MRC would be cheaper if they could salvage the cooler trying to get the car to Banbury would mean a day off work and me sitting at there while they did the work. As there was only 2.5 hours labour and the bulk of the cost was parts I thought it was worth paying the labour so the work was guarantee the work for 2 years rather than doing it myself to save a couple of hundred quid.
Frustratingly the price they quoted was excluding VAT so the total bill was £1282.21. WTF, why wouldn't you quote the price with VAT?? I'm not a trade customer.
Anyway rant over. They did keep the original parts though so I could have a look and maybe get the cooler refurbished. So pics below
Passenger side pipe connection


The rot on the pipe

No leak from the drivers side but pretty corroded


This was the bit that concerned me if I was going to do the work myself as I couldn't find how the pipes connect to the engine. Probably easy to see if you dropped the bumper but when I took the undertray off I couldn't quite see it.

Part numbers with list prices
8E0117315 Oil Line £82.59
8E0117316 Oil Line £121.18
N91044502 Seal £22.67 x2
4D0260778 Mounting £4.86 x4
079117021T Oil Cooler £562.24
8E0117146 Grommet £12.11
1.6 litres of oil at £13.00/litre so £21.45
Gutted to have had to pay out for such a hefty repair in just 6 months ownership but not as gutted as I would have been if the pipe let go and dumped the oil while driving the car hard.
Hopefully this info may help others