I have a Mk2 1.4 98 plate and my dash looked like yours when I started too.
1. Best steering slak adapter - Your best bet is Halfords just to be safe so if t does not work for some reason you always have something to fall back on. The thing is with adapters it could cost you between £30 - £40 as you need 2 cables. ALSO MAKE SURE YOUR HEAD UNIT YOUR ARE BUYING HAS THE ABILITY FOR STALK ADAPTERS.
2. I wouldn't have thought loking at the Alpine Headunit that you are going to have to run a external microphone it should be built in the front like mine. Don't worry about this they still work fine. And with the windows up even better. BUT if you do need to I would personally run it behind your steering column to your right hand side when you are driving maybe stick it next to the mirror stalk.
3. If it comes with a Ipod interface thats cool but personally I like Jack to Jacks and your have a audio port on the front if you get the attached alpine one soooo you could get a 3.5mm Jack to Jack to play any other media device through your car.
Cheers - Hope this helps!!!!
1. Yes i have chossen this headunit because it has the ability for that. I normally try to stay away from halfrauds but will go in this weekend to see if they have anything there or any advice.
2. The wiring diagram in the manual talks about a microphone and theres no obvious markings or holes on the unit its self giving away a microphone so i assumed it would have to be ran behind the dash etc.
3. I want an ipod interface because i have 15,000 songs and would be nice just plug it in the glove box forget about it and control it all through the headunit. But the unit does have a frontal usb and 3.5mm jack if i need to plug anything else in.