You figure there's much power up there? From what I've seen of the TDI torque curve it begins a pretty steep plunge at about 2500rpm. By the time 4500rpm rolls around and the ECM begins to pull back the fueling they are usually down to about 30% of the peak. This seems to be common to all TDI's, chipped, injectored, big turbo or not, even TDIRS's mechanical pump engine has roughly the same torque curve. I'm thinking its just charge mix/burn time thats killing the power. More timing advance can help with ignition lag but it can't speed up the burn. I think for the TDI the power needs to be made with cylinder pressure (torque), not rpm.
You "think" something is killing power up there; I still can't take anyone's assumptions or theories to be 100% true. I don't recall anyone having actually tested a high RPM TDI. Today's powerful TDIs featured at tdiclub.com still aren't at their limits; we're just scratching the surface of their power potential, compared to what the tractor and Cummins guys have already done years ago.
Nobody thought a few years ago that a 6cyl 12v Cummins motor would make useable power above 4,000 RPM. Now it's possible. Piers Diesel is currently building a 6,000 RPM motor.
Unless someone can provide credible data stating that extra RPMs will not yield more potential HP in a VE 1.9 TDI, I am still going to continue with this project because I'm curious

This is a drag only project so I'm willing to blow the engine. Then I'll have the block rebuilt (or another block purchased). The design of the internal block parts, and the pump, can be modified. Manufacturing for custom TDI pistons and cranks are already available (there is a 2.2L stroker kit for VE 1.9L TDIs in Sweden, but for low RPM application).
Despite the peak torque usually occuring at around 2,500 RPM in a relatively stock TDI motor, the peak HP with a "bigger" turbo, injectors, and stock cam is just above 4,000 RPM and it stays relatively flat up to 5,500 RPM with good tuning. This is one of the most powerful TDIs I've seen so far, with a nicer torque curve for street use.
FYI I tune chips in association with another tuner in Europe. The fuel maps can be adjusted well past 4,500 RPM. The ECM pulling fuel by 30% you mentioned has already been addressed a while ago.
Can the HP curve be made to remain flat or gained just after 5,500 RPM? I think it's possible, and it may gave better HP results than having to resort to excessive cylinder pressures in low RPM.
There was a pump timing / high RPM discussion on tdiclub.com a while ago, although there wasn't much content:
http://forums.tdiclub.com/showflat.php?Cat=0&Board=UBB4&Number=987518