If you have pressure building up in the cooling system and blowing water out of the overflow/header tank that will probably be down to a leaky head gasket.

A faulty HG will not of itself cause the engine to overheat, it does so after its lost a substantial ammount of water. If you are not loosing water before it overheats then the thermostat is probably at fault.

There shouldn't be air bubbles in the header tank. You should be getting a flow of coolant from the return (small bore pipe that attaches to the top of the tank) and to check it, take that pipe off, hold it in the open filler cap neck and run the engine at around 1500 RPM and see if it's flowing. If the flow is weak or non existent, there is a problem with the pump. VAG's had a problem with the plastic impeller wheel either slipping or breaking off the metal drive spindle causing a lack of circulation and thus, overheating.

This flow check is easy to carry out but you will need to get it block checked at a garage to see if the head gasket has failed due to overheating. This involves using specialist kit that can "sniff" hydrocarbons in the cooling system and usually involves a blue coloured fluid in a tube that's held in the header tank neck and changes colour if it detects exhaust gasses in the coolant.