Why yes, I have put a diesel in my '89 wagon.
The engine was scrounged from a '79 diesel Rabbit, so it was a 1.5 diesel.
It's still mounted in the stock orientation, using the stock clutch and transmission.
I stripped the engine block of all it's mounting brackets, water pump, flywheel. I had to use the IP bracket from a Dasher, which is also longitudinal, as the Rabbit bracket had the integral front engine mount on the IP bracket.
The Fox clutch is cable driven, I used the flywheel, pressure plate and clutch disc from a Quantum so I could get the right timing marks on a longitudinal diesel.
The water pump, water hose outlets, oil filter mount, and engine mounting brackets are all transfers from the Fox engine, allowing me to use the stock Fox cooling setup and pipes.
I don't believe transverse starters and longitudinal starters are interchangeable; in any case, I didn't have the stock Rabbit starter, so I scrounged up a Quantum turbodiesel starter in its place. The stock Fox motor mount needed a light grind to be able to clearance the starter's motor. Later, when the engine becomes turbocharged, I'll be replacing the Fox mount with the Quantum TD mount, which has the integral turbo support mount cast into it.