Well, maybe you don't need a flame suit, but this is an oft debated issue. If you search the forum archives, you'll find numerous discussions on it. That said, I'll offer my $.02...

I have a 2.7T and love it. Coupled with the 6 speed (which you cannot get with the 4.2) I have a wonderful blend of performance and economy (at least as much as you can expect from an A6). With today's gas prices, the greater mileage of the 2.7T is an important consideration. Your altitude will also love a forced induction engine.

The 4.2 is a beast. It uses pure displacement to provide its thrill. You'll pay for that at the gas pump and it's not quite as fast off the line, but mash the gas on an entrance ramp at 40 and you'll be out in front of traffic before you have a chance to look for it in your side view mirror.

Reliability I'd have to give to the 4.2. This because an Audi service tech trainer (Audi of America employee who trains Audi dealer technicians for a living and has LOTS of feedback) and an Audi field engineer (Audi of America employee who resolves issues escalated by dealers to Audi of America and gets even MORE feedback) both said the 4.2 is a more reliable engine. They have more experience than any single individual you're likely to meet so I have to give their viewpoint on this the winning nod.

Good luck!

MODS/UPGRADES:
17x8" BBS RKs (great AW story about how I got them...) | H-sport anti-sway bars | ToyGuy short shifter |
IceLink/iPod integration | Escort 8500 hardwire | fog/running light rewire | HomeLink home lighting control |
fold-down bag hooks in the trunk | aux power socket under the armrest | hidden Symphony EQ settings |
remote locking control recode | debadged

SUGGESTED READING FOR C5 A6 OWNERS:
2001 A6 info from AudiWorld | 2001 A6 info from Edmunds.com |
Audi 2001 maintenance schedule | Stoney's links (the ultimate A6 links page) |
the nOOb's guide to everything | how to make your car shine

The other ride: 1998 Mitsubishi Montero (typically with a kayak on top)