So I will try to keep this as short as possible. I bought my A4 back at the end of October 2010. It's an A4 30th Anniversary edition with the 2.0T engine. Not long after I purchased the vehicle, I bought a K&N intake for it. The sound that my vehicle made was awful. It was a high-pitch squealing noise from about 2000-5000rpm. Between the 5000rpm and the red-line, the squeal would disappear and I could hear a sound that was more like the turbo (which is more of what I expected it to sound like, but in the lower rpms). I immediately blamed the new intake, so I removed it and installed the factory air box again. The sound was gone. I re-installed the K&N intake again wondering if maybe a hose clip was loose, but it still continued to make the squealing noise. So K&N bought the product back from me and everything was all good.
Now with the nicer weather here (I live in Ontario, Canada), the windows are down more and I have noticed this squealing noise (consistent with rpms) again. I now realize that it wasn't the K&N product, it's my car making this noise; the K&N intake just amplified the sound. Some other things I have noticed are that during 'spirited' driving (higher rpm's), a fairly strong smell of exhaust fills the cabin. My exhaust has also been making 'crackling' noises during idle when the engine is hot. It usually makes 'popping' noises after I shut the vehicle off from driving it, but it has made the 'popping' noises since new, so I figured it was just the exhaust cooling down. This 'crackling' noise during idle has just recently started and I don't think this is normal.
So, now the kicker; with all of these 'issues', I have no 'check engine' lights on, and the vehicle seems to run pretty much normal; although I seem to remember it being a little more 'peppy' during lower rpm's when I first bought it. I'm not sure what's going on with the exhaust, but I'm wondering if this 'squealing' noise is the beginning of the end for my diverter valve. I read somewhere that a 'squeal' between 2-5000 rpm is typically a bad diverter valve. The reason it quiets down after the 5000 rpm is to do with the waste gate. Can't remember what it does, but the engine senses a loss in boost and the waste gate does something to counteract it.
Anyways, the smell of exhaust in the cabin while the vehicle is moving would signal a boost leak to me. However, with no 'check engine' light, I'm guessing this is a very small boost leak?
Has anyone else had this issue? Or does anyone have any idea what this could possibly be?

 

You mentioned a possible boost leak? Are you experiencing any loss in power? Do you have your windows down when you are smelling fumes or up? My cabin has zero smells coming out of the engine bay or exhaust.

As for the metal cracking / popping sound, that is normal. All B8s have that.

As for the K&N intake, you should do a google search on the K&N intake for the B8. It has been talked about on other forums.

 

I do have a slight power loss; nothing substantial though. I've lost some power in the low-end. The torque is suppose to be at max beginning at 1500rpm, but mine doesn't really pull until about 2500rpm.
The windows are up when I get the exhaust smell in the cabin. That's what leads me to believe that it's a possible boost leak; the exhaust would be leaking under the hood, and coming in through the vents. The smell isn't overwhelming, but it is noticeable. Would a bad diverter valve cause this? I've also read though, that the B8 A4's use a spring-type diverter valve instead of the old diaphragm-type. I was worried I had a hole in the diaphragm of the DV, however, if mine has the spring-type DV in it, then what could possibly be the problem?
As for the K&N intake; I did some research on the net before ordering it. It had mixed reviews; some loved it while others hated it. I took my chances with it, but in the end I'm now realizing that the squeal wasn't from the K&N intake because it's still present now; just not as noticeable.

 

I have the same popping noise in my Audi A4. It sounds like my 2 year old farting. So is this noise normal? It's kind of embarrassing because I have this nice car, but when I goto shut it off it sounds like it's farting. Could it be that the exhaust system has a leak?