I think you will only need to retard the timing somewhat, an ECU mapping for high compression would be better, but it depends on your budget. I am going to be fitting some of those coated 11.6:1's soon, but I have to collect some other parts before taking the engine out.
I have a spraybar lowport with RR cams fitted, I think those will be ok, S3's should be ok, but I havent seen the numers for the lift limit of those. But they are designed for higher powered motors, so they damn well should be ok for s3's, but wait for a definative answer from someone who has fitted that combo.
Mike