Here is what I figured out.
Text messages don't require the banner to be enable but email does.
I got email working by ensuring I was pulling/polling the correct mail folders. I had them set before but when I upgraded to IOS6 the settings reset to just the inbox instead of including all my custom filter folders.
The email comes in but it shows as text messages, not email, so you have to make sure text, or all message formats is selected. Most likely a bug or something on my car needs updating.
For both email and text, the phone display does not have to be locked.
So both text and email are working to some extent.
I think the whole system needs more work. For example, if I get a text, I would like iDrive to autmatically display it for a few seconds. Maybe even chime. Right now a little envelope icon shows up and you may never notice it.
2013 VW Golf TDI