Twice in the last 2 weeks the turbo on my 2.0 TDI Audi has shut down while driving. To reset it I have to stop, switch the engine off and then back on again. I took it to the dealer who tells me I need a new Turbo that will cost around 2 grand.Does this sound right?

In the most cases for Audi 2.0 TDI the turbocharger is responsible for engine losing power.
The car goes in "limp home" mode!!!
After scan the EDC-15P engine control unit with a VAG or KTS -BOSCH diagnosis tool you will find this: Fault code: P1557-Turbo Boost pressure control exceeded
1. Engine stopped and ignition switch off. Check all pneumatic connections and hoses between turbocharger actuator = pressure unit for boost-pressure control, boost-pressure control solenoid valve, vacuum reservoir, EGR control solenoid valve, intake-manifold flap solenoid valve, EGR valve with throttle - part of intake manifold. Also the vacuum connection between tandem pump and brake booster. If you find something wrong replace parts. If not go to step 2.
2. Extract the hose of the turbocharger actuator = pressure unit for boost-pressure control part of turbocharger. Instead of the original hose you must place another 1 meter long hose with the same inside diameter, and then you check to inspire yourself the air from the other one extremity of this hose. The mechanical connecting rod of the turbocharger actuator must have a smooth and whole motion. If you can do that with your mouth, then you must replace the boost-pressure control solenoid valve. If you can not reach this with your mouth, then you go to step 3.
3. This is the most difficult work. The problem is that the soot particles deposits inside the turbocharger plugging the variable nozzle geometry mechanism = adjustable vanes of the turbine. If the turbocharger actuator is not able to adjust the turbine vanes the charge air pressure increase too much and ECU (engine control unit) go in "limp mode" = engine protection software. As a result the "limp home" mode engine still running until you turn the engine off (ignition switch off) and back on when the "limp mode" is deactivated, but the fault still remain in ECU memory!
4. You must be able to extract the turbo from the engine and then to disassemble the turbocharger, clean inside adjustable vanes mechanism and refit all.