Glad to see another VW being saved. May I start by saying that you MUST concentrate on getting the engine, drivetrain, suspensino and steering sorted before anything else. Technically speaking our VWs shoudl run 100% with the bodys off. Only then should we start worrying about the bodies. I'd suggest you start by doing all rebuilds where needed (steering box, engine etc) and then get ALL fluids changed and ALL points greased.
You MUST also change all bushes and seals as they are probably dead or coming up to a time where they'll need to be changed,... best to do it now.
One major area people neglect is the seals which seperate the hot & cold zones of the engine. It is critical to keep the zones seperate otherwise you'll end up with a dead engine before you know it.
I'm going to follow this thread from here on and drop my 2cents from time to time,.. but I should point out that some of the greatest VW minds on PW are already posting here already.
not a 1303, that's for sure. but the rest of your advice is bang-on, the VW club of Pakistan always suggests that people restore their cars form teh ground up but sadly the trend in PK is to repaint it and fit all the chrome stuff they can find. hopefully this resto job will be more like reezvaans patina resto and less like a standard pakistani resto-mod.
do not chrome anything, the local stuff is useless and the money you'll waste could be used to fit a quality part which would last MUCH longer.