It's been a while since I swapped a steering box on a sedan, but let me try answering you;
Is it neccessary to remove the tie rods from the pitman arm in order to remove the pitman arm from the box output shaft or is there enough play in the tie rod joints to simply drop the pitman arm from the shaft?
There is enough tie rod play to drop the pitman arm while they're connected, but the pitman arm is often rusted to the output shaft and unyielding so you may need to heat the heck out of it and/or use an arm puller. A two-arm pulley puller should do the trick if it's really stuck - heat the arm for this, too. Once you get it loose, if it won't release because the tie rods are binding, simply loosen the box mounting clamps to get more freedom.
Then when the new box is in will the pitman arm simply slide onto the output shaft or will I need to loosen/ remove the tie rod ends to reinstall the pitman arm ?
The pitman arm only goes onto the output shaft one way, so you'll have to rotate input/output shafts to align with the arm so it'll slip on. Do this without the steering shaft coupler attached at first so you can keep the mounting clamps loose to get some additional play in the box to allow it to line up with the arm and vice versa. There are three inner teeth to keep the arm aligned and they are very slightly tapered to get it really tight (part of the reason it's hard to remove) so you'll need to line them all up and then it should slide right on. Lightly sandpapering the inside of the arm hole and teeth is always a good thing, just to clean it up. I don't recall the torque spec on that pitman arm nut, but it should be in your VW service manual. I wouldn't exceed the torque spec at first. It'll take a lot but it WILL stretch the threads if you really get on it and exceed the spec by 50+%.
If you're careful about keeping everything straight while doing this, then you can replace the steering shaft to the input shaft and it'll still be straight. If you mess up, then just loosen the clamp on the steering wheel shaft side of the coupler, pull it out, straighten it and put it back. I think the splines (shallow tho they are) will give you about 10-15 degrees of movement each.
gn