It only took a few minutes of driving our 2006 Audi A3 tester, equipped with the Direct Shift Gearbox (DSG) transmission, to figure out that even cars with a flatulence problem can make a good impression. No, it wasn’t a case of that rotten egg smell that came from my old Pontiac Grand Am. It was more like when my dog has eaten too fast – a “poof” sound comes from her rear end, causing her to become alarmed and look with fear to her hind quarters. Oh, my, that’s funny stuff.

In the Audi, the “poof” comes from the exhaust, a result of upshifts orchestrated by the DSG. With regular and sport modes, as well as manual shifting with either the shift lever or paddles on the rear of the steering wheel, the DSG-equipped A3 offers drivers a variety of ways to move the gears. Leave the tranny in drive for seamless shifts that take place at lower revs for a more tranquil ride. Drop into sport mode to keep the revs up longer for better acceleration. Or bump the shift lever to the right and flick it up and down for manual shifts. But, for the most fun, fly through the gears using the paddle shifters on the steering wheel, which can be used regardless of whether the Audi A3 is in drive, sport, or manual mode.

That sublime gearbox is connected to an equally fun, turbocharged engine that offers impressive acceleration across most of the rev range, and remains composed even when pushed for all it’s worth. Add to that laudable powertrain the A3’s sharp handling and powerful brakes, and the result is something you don’t see all that often – an extremely fun wagon.

Of course, the 2006 Audi A3 does have its drawbacks, not the least of which is the as-tested price of $33,910. After depressing the throttle, that turbocharged engine takes what feels like a full second before opening up the gates, serving to put a crimp on your grin. The cabin is filled with durable leather, aluminum on various interior bits, and padded surfaces in some key areas. The materials are appropriate for a $33K+ car, but detractions include a few large gaps, hard window sills, a center navigation screen that washes out in sunlight, and narrow front buckets. Rear seat accommodations are tight, with small door openings and headrests that poke into passengers’ necks when in the down position. Our tester also had the dual sunroofs, which are nice, but with only mesh sunshades, you’re never able to fully block out sunlight.

From a design perspective, the 2006 Audi A3 is a mixed bag. Inside, there are the tight seats, but outside are fluid lines, gorgeous 17-inch alloys (included on our tester with the Sport Package), and the most attractive use of Audi’s massive new grille. It just may be the best looking small wagon on the market. On the flip side is the interior’s storage capability, which aside from the cargo area is lacking. There’s a generous pocket in the front center armrest and two front door storage areas, but there are no seatback pockets, no other console storage of any value, and no rear door storage. There’s some space in the rear fold-down center armrest, but it’s filled with a first-aid kit.

Then there’s the competition to consider, including vehicles like the Saab (Subaru) 9-2X and the Volvo V50. Both are in the same ballpark price range, but come with standard or optional all-wheel drive, offer more available horsepower and torque, and provide significantly more cargo room. And, for my money, the competitors’ added traction, power, and versatility trump the A3’s style and fun factor.