The 206 is best described was an admirable stab at a quality small-medium size car, which is let down by inconsistent manufacturing standards and component suppliers. Owning one of these can be a very fussy and frustrating experience, when it comes to anything other than oil and air filter changes. If you are keen to sell and show some respect for the next owner, you will have supplied a Haynes manual or at least a list of paper, with the type of Spark Plug, Brake Caliper, and Brake Disc type written down; Peugeot used lots of different manufacturers for these items, maybe other things too. They are not interchangeable and you will need to remove components or take photos/serial numbers along to parts outlets before you buy, which is time consuming.
The stereos are also rubbish, especially the speakers; they blow and will probably need replacing so check this by listening to it whilst altering the FAD/BAL on the controls. Stock replacements for the fronts and rears are cheap, but 5door versions have rear speakers rivetted into the doors, so will need drilling out. Pioneer do a good 5.5 inch replacement unit for the front, around 55 quid for a pair.
The 206 also suffers from inconsistency in the body panel quality; panel gaps are a little variable, and this is not down to crash damage! Check the headlights immediately for damage; they are usually electrically adjustable and are not cheap to replace. Also, from '05 the front and rear light design was improved, along with some other detail changes (body-colour bumpers standard etc.). Finally, for all diesel models, check that the fuel filter has recently been replaced, especially the Diesels; they're 70-100 quid each, and no you will not be able to unscrew the housing without damaging it so don;t bother.
The Petrol versions of the 206 are very similar to older Pugs and Citroens mechanically; the engines are mostly solid, reliable and offer good performance / economy, but I tend to avoid the 1.6; it seems to be less economical and is more prone to gasket failures that the other TU engines. The 1.4 VVT engine is pretty good, offering more performance and refinement than the old 8v, but the valve timing doesnt make up for the hit you take in economy, having 16 valves.
The GTI is a bit of a strange one - They are quick and fun to drive, but they are expensive to insure and they are very sensitive to tyre choice; Michelin are the best in the wet and dry, but prove to be absolutely lethal in 'damp' conditions (If you;re an F1 fan, think 'intermediate'). Check the forums on that one.Watch out for faulty lambda sensors and fragile exhausts / downpipes (very expensive). I am not sure that, as somebody experienced with hot hatches, the GTI really 'nails the deal' in the face of competition from the Focus and Fiesta. If the GTI is not worth it, however, the 180 is even less worth it - the build quality generally isn't up to the thrashing they get in every area other than suspension. They get a lot, if anyone has expected performance out of them, then the engine will have been revved hard. It should be up tot he task, very much like the old Citroen BX XU9J4 16v (GTI Soupapes/16v) engines were so good at. The XU10 engine in the 206 is the worst of both worlds...needs revving, and complains about it by getting smoky tappety at high mileage. Generally, A GTI 180 is for those that want exclusivity, are willing to pay a premium for it (an the insurance) but also yearn for that feeling that it was not worth it in the first place. Very much then, carefully try at length before you bid or buy.
My first choice for a 206 would be a 52/03 reg or 05 or later reg HDI. The 1.4 is superb in every respect if you don't want fast acceleration, but check that there are no signs of leaking coolant around the hoses and rad, and ENSURE THE RED FAN WORKS. The SW is extremely practical, but there are some minor differences in the servicing items between the hatch and the SW (Air and Fuel filters are different). Get a cambelt change receipt from a reputable independent or dealer; its expensive on the 2.0 HDI as the job is a pig. In fact, anything other than routine maintenance is a bitch on the 2.0HDI, so ensure it was done recently. Make sure that there is no smoke out the back under full acceleration, and the MPG should drop no lower than 19.0 on the on-board meter (2001 onwards only). If either of these things happen, suspect poor service condition, or a leaking turbo inlet pipe. The latter is located behind the engine underneath a load of stuff and is labour-expensive to rectify. I found the turbos on these cars generally quite noisy, but poor servicing / lack of maintenance will increase this. I drove one for sale once and thought an Ambulance was coming up behind me all the time!! Faults may register on the central display from time to time: 'Anti-pollution Fault' indicates Fuel filter or contaminated fuel, and demand it fixed. Good tyres (Hankook are excellent) should be fitted on a HDI as the handling improves massively. The pace of the 2.0 litre is not a million miles off a GTI anyway, and if driven carefully, expect 65.7MPG.
Overall, the 206 continues Peugeots excellent reputation for good diesels, and HDI's are now becoming very cheap. Ignore the 1.6HDI in later models, it's not worth paying the premium. The safety is better than the 306 it partially replaced, but get a decent 1.4 or 2.0HDI, and try one of those 99 quid plug-in power boosters if you want. However, as an indication of my overall rating, make sure you try out other sporty hatches vs. the GTI, or for a diesel, try a later (1999-2000) 306 Meridian HDI 2.0 first. It's better for practicality, if you don't mind an older car, has the same engine, but will be a grand or so cheaper. Chipped, it's a very surprising package.