The Volkswagen GTI has represents a potent combination of sports car-like finesse and tuned driving excitement in a versatile hatchback design

2010 Volkswagen GTI

What was tested?:2010 Volkswagen GTI four-door sedan with DSG, Direct Shift Gearbox.

Options: Power sunroof ($1,000), navigation package ($1,750). Price as tested (including $700 destination charge):

Price as tested: (including $700 destination charge): $28,440.

Pros: It's fast, refined and smart looking. It's nostalgic, too, with throwback styling that evokes the original hot hatch of the 1980s.

Cons: It costs over $24,000 with the awesome DSG gearbox."

Competitors: Mazda 3, Mini Cooper, Audi A3.

If you're shopping for a compact car, there are a few things you can always expect to find, like a low price and good gas mileage. But what about refinement?

Unfortunately, most small cars aren't on the leading edge of technology, smoothness and sophistication, and buyers generally don't mind. They're looking for something affordable and efficient. If the engine has emphysema and the suspension has polio, so be it. The Volkswagen GTI, though, is different.

The 2010 Volkswagen GTI continues its performance showcase inside the cabin, with accommodations that will delight both driver and passengers

2010 Volkswagen GTIinterior

This compact car aims, above all else, to be refined. It's a little more expensive than most commuter cars, but it feels a lot more expensive, with the kind of performance, comfort and tech gear that you'd normally expect from a luxury brand.

Take the GTI's transmission. Normal cars in this class would have either a manual or automatic transmission -- nothing fancy. But the GTI comes with one of the most impressive pieces of technology in any car at any price: a Direct Shift Gearbox (DSG).

The DSG is something you'll often find in exotic sports cars. Essentially, it's a robotic manual transmission that offers the perfect combination between a stick-shift and an automatic.

Like a stick-shift, it offers ultra-fast shifts that make the driver feel connected to the car. But like an automatic, there's no clutch pedal to get in the way. You can change gears with paddles on the steering wheel, or you can leave it in fully automatic mode for normal cruising around town.

The latest version of the Volkswagen GTI utilizes the acclaimed 2.0-liter 16-valve DOHC turbocharged and intercooled four-cylinder gasoline engine

2010 Volkswagen GTIengine

Another big difference is under the hood. Where most small cars would have a regular four-cylinder engine that may or may not sound like a lawnmower, the GTI adds a turbocharger and intercooler to create a powerplant that's as powerful and smooth as anything in its class.

Step on the gas pedal, and the GTI responds with a torrent of torque that can easily spin the front tires. It makes 200 horsepower and 207 pound-feet of torque, absolutely ridiculous numbers for a car this small, so it definitely lives up to the GTI's legendary performance. And really, that's the story of the GTI. As much as it's a great car, one with the mechanical precision that feels so wonderfully German, it's ultimately a vehicle that lives within the broad shadow of its hot-hatch predecessors. It's a throwback car.

Volkswagen brought the original GTI to America in 1983, spawning a a whole new type of car -- the sport-compact -- with its powerful engine in a small package. It was a hit right from the start. It was also noted for its distinctive style. The classic GTI has black paint with little bits of red trim, big wheels and a sporty body completing the package. Today's GTI continues the trend with a strip of red trim around the grille and some huge, old-school phone dial wheels that evoke the 1983 original. It's stylish, but not in a flashy way -- more like the kind of style hardcore VW enthusiasts would notice more than ordinary drivers.

Again, it's all about refinement.

The suspension is also surprisingly advanced. It's fully independent, with an unusual rear layout that improves handling and provides more space in the cabin. The details are boring, but the results are outstanding, with incredible grip, poise and control in corners that you notice at speed.

Overall, it's hard to find a reason to dislike this little car, assuming you can swallow the price. It's quick. It's sophisticated. It's cute. It's practical. And it stands apart from the crowd. Best of all, it's about more than gas mileage and the window sticker.