Hey,
Moved recently from the Elk Lake area, have had an A4, S4, and TT there, and used to travel all the back roads there all winter long.
It's an outstanding idea to have a dedicated winter setup. You don't want to trash your summer wheels in the winter there, and your summer rubber will just last that much longer. Many tires don't like to have their bead disrupted around the edge by changing rims 2x/year also.
I've used a lot of sets of winter tires up there, and, continuing to follow winter tires closely (sorry, it's become a bit of a fetish) my recommendation based on what's out there now, and knowing what you'll be driving in, would be to go with the new General/Continental Altimax Arctic (made in Germany) or the Hankook iPike. I would suggest the Nokian Hakka 5 or one of the Gislaved tires, but they're harder to get and more expensive.
Be sure to keep full pressure in the tires (check when colder out), it will help with the dry handling. The tires will be a bit slippery at first from the mold release agent in the treads from when it was made, so know that, and drive a bit on dry pavement to help get it out of there.
I had the predecessor of the Dunlop Wintersport 3D when I lived there by you and was underwhelmed. I know the 3D is better than the older versions, but it's still an all season plus kind of snow tire, and you deal with a lot of pretty dicey conditions up there with lake effect on 31, etc. etc. in the winter, so I would definitely recommend going with a bit more hardcore of a snow tire, knowing that you'll be sacrificing a bit more dry handling to keep safer when it gets nasty out. People think that because you have quattro, it doesn't matter what snow tires you get, forgetting that the snows will do a lot of your braking when it's nasty out, when quattro doesn't help at all.
I'd get a 16" wheel setup if I were you. I had both when I was up there, and the 16" set was less trouble prone. What I found was that during my travels up there, even on the 16's but far more so on 17's, snow and ice would build up inside the rims and cause a balance problem (easier for it to get in there with the lower profile tires), so I'd be driving down 31 or 72 and have the wheel be shaking violently from being out of balance. Solution: know where the DIY car wash places are (Kalkaska, Petoskey, TC, etc) and spray out the wheels when this happens.
A quick search shows that the Petoskey WalMart carries General Tires, so can probably get the Altimax Arctics pretty cheap if you don't get a wheel / tire set from Tire Rack or Tires.com. (Tires.com is Discount Tire, also in TC by Meijer). Not sure I'd let WalMart touch my A4, but you could maybe just buy the tires there, if not at TireRack/Discount Tire.
Lastly, put those stock tires on craigslist, etc. in the Spring and get some real summer rubber on those nice rims next summer. Did that with ours when we got the car. Now that you'll have a good dedicated winter setup, there's no reason to be running compromised no season tires at all....too many fun roads up by you to waste your car on no season tires.
Have fun and be safe.
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