Back on track i still don't think in my honest opinion that its worth swapping out and getting the 2.0L if you already have the 1.6 and you are happy and it does the job.
If MPG is your thing then by all means pick a diesel. Yes they dont appear to be as charasmatic as the petrol engines but the Fiat/Alfa/Lancia group do make some decent Derv's that the majority of owners on here are very pleased.
All engines suffer with some niggling issues and are far from perfect.
The TS engines gulp Oil and suffer bottom end issues as well as they need love and attention on maintence as I feel they are pretty fragile.
The Derv's suffer with EGR issues and water pumps plus the usual DPF and turbo woes that occasionally crop up.
The petrols are generally cheaper to buy. But you pay more at the pump.
Both have their own charateristics. Your best bet is to try the various versions before making a decision.
Anything with a Turbo and modern ECU's allow Derv's to be tuned simply to get more out of them without any real skill needed in tuning (however this can lead to higher service intervals).
It really depends on circumstances and your own particular driving style or needs.
Any variant is good as you've opted for an Alfa.
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Alfa 166 2.0 Twinnie - LPG and a few trick performance parts