The break in the hose could be futher down, whereby the leak is exiting in front of the rear wheel. It'll be one of those jobs, that'll be, "seek and you shall find". Bearing in mind that your Lupo is now 16 years old. 122k miles is below average mileage. Average mileage would be around 160k.
Does the gearbox feel okay to you? And is the clutch pedal travel quite high? As Lupo's that have been driven hard, do suffer from gearboxes, especially around this sort of mileage. If the above is fine, then you may have got a bargain. It's hard to say without seeing the car for myself. If your ever in Petersfield, Hampshire pop in and see me, as I work at White Rose VW, near the railwat station, pop in for a chat!
Regards, Dale.