This engine is notorious for water pump and (usually consequent) timing belt problems. Your water pump may have stuck if the car has been inactive and caused the belt to jump or shed a few teeth.
I would recommend that you make most careful and detailed checks before cranking the engine - any damage is ruinously expensive on a vehicle of this age.
The job is a bit of a pig, even after you have pulled the front into the "service" (wonderful VAG euphemism) position - there is plenty of bedtime reading on the Internet. Try to get a pattern water pump with a metal impeller.
we had issues with our 2.5 tdi.It ended up as the injector pump failed.With the injector pipes removed it would squirt fuel,but wouldn't run.Easi start would get it started but would die as you said after it burnt.Check the immobiliser too after the battery issues.It made me loose a kidney paying for the new pump as no-one had a second hand one and it is relative to the engine codes and the immobiliser runs through it too.Old pump was rebuilt and bang off it went.Sold it soon after as too costly when they go wrong. MEGA QUOTESNIP!
Are you sure that yours hadn't just jumped a tooth? If it was spraying from the injectors, then it was doing it's job - just a fraction late.
For some odd reason; all TDis [particularly around '99] do this - often soon after a new cam-belt.
I've even had to diagnose one for a VW dealer; who blankly refused to believe me - until an unfortunate tech got the job of removing the front and checking the pump timing; which was one tooth back......
I never did find out whether the customer was charged for the £2000-odd worth of parts that they'd already tried....