I don't have any experience of fitting a 200tdi into a series 3, but I'm planning on doing this conversion in the next few months. I do have experience of fitting a Transit engine to a series III, and it took a bit of fiddling about to make sure the front diff and propshaft would not hit the engine when the front suspension was fully compressed. It can be very difficult to guage if there is enough clearance, so I made a very simple tool for checking the clearance. What I did was measure the distance between axle and bumpstop and then cut a metal rod to that length. You then put one end of the metal rod on the areas of the axle which are likely to come into contact with the engine and keep the rod vertical - hopefully the top of the rod will not touch the engine - or even better will have some clearance to allow for the bump stops and engine mount rubbers compressing. It's not quite that simple though because the axle moves backwards slightly as the suspension compresses and it also rotates a bit under breaking and acceleration.
Could the problem be solved by lifting the front of the engine slightly, or machining the pulley perhaps? I don't like the idea of lowering the bump stops as that will make the suspension even crapper than it already is!