Yes this is one of my BIG gripes with my 96 A4. The problem is not so much that the compressor won't come on. But some freekin genius made it so you can't have recirculating air unless the compressor is running. So anytime you are driving in the cold you can't have recirc air. Now 95% of the time this is a good thing, but when you get stuck behind some piece of crap car spewing oil fumes it really is annoying to not have the recirc option.

I figured they would have fixed this by now.... stupid design.

But I happen to recall it stating that the "compressor" is not on all the time, just as needed, however the compressor icon shows all the time.

When the interior temp sensor on my 99.5 senses that the temp is below the set-point, the compressor shuts off. This can be visually verifed by looking at the tach while the engine is idling, the RPM's will "glitch" when the compressor clutch engages/disengages.

The only thing to keep in mind is to press the Recirculation button first, then the Econ (former Snowflake) button. If you press the Econ button first, it will go back off when you press the Recirculation button.