Specifically, if you use factory tweeter locations are they designed for optimum imaging, or would I be better off with a Coax?

I asked my installer the same question since my first first choice of speakers was a/d/s 344is separates. He strongly recommended that I mount the tweeter down low with the midrange rather than in the factory tweeter location. Since he has been doing high end installs for 20 years, I have decided to go with his recommendation.

if you are comparing a set of Focal 165HC (coax) to a set of Kicker Impulse seperates, the Focal is gonna blow the impulse away. and you are paying more for the Focal, too. when my customers are on a tight budget, i usually ask them to get a pair of good coax to replace the stock seperates instead of buying some entry-level seperates coz they will usually sound better. And if do have a good pair of seperates but not planning to spend the extra cash on an amp for it, i will say go for the coax.

some opinions.

hence, coax would probably be better. Ideally, a coax of at least 6.5 inches would be best.

Professional car stereo installers will agree with PbPedis. Separation of the midbass and tweeter produces phase-shifting which basically means the two sound streams reach your ears at slightly different times. In other words, it sounds bad. A good quality set of PROPERLY placed coaxials will sound better than Audi's current setup. I have seen the stock tweeter left blank with a 5 1/4 coaxial (6 1/2 is better but cuold overwhelm the aesthetics) replacing the stock 4" (or whatever it is) midrange. The only trick is that a custom enclosure has to be built in order to produce optimal sound.