I wonder if the butterfiles in the system tend to act like throttles in the case of deceleration?The downside with diesels is they dont really offer engine braking. Its super minimal.
The Touareg does seem to have some engine braking available without revving up too much.
Downshifting seems to be useful and does help a lot going down those mountain roads.
I pretty much let the transmission work out the shifting on the way up the hill and manual down.
It is possible that if the cruise control were engaged the CPU would downshift to control the speed too, but I rather control the downhill myself.