So one of the things bugging the heck out of me with my 07 4.8i I purchased last month was the headlights. Heavily oxidized and dis colored to the point where they were diffusing the effectiveness of the xenons. Took care of it last weekend.
Using the 3M headlight restoration kit and my drill, I sanded down and polished the lense covers. Messy job but effective. I then treated the bare plastic with some UV protectant to stave off yellowing. Finally, to protect the work, I covered each headlight with Lamin-X film. Loving the results.