I bought the T5 AWD, 6sp.
Prior to this a year ago Volvo Canada sent me on a ride and drive in the S40. At that time they only had the auto's out, it was a great handling car, we had it on the street and the track putting it through its paces.
I have experienced (at different times)the "gear tronic" in the S80's, XC90's, its nice but gimmicky. In just the auto mode it is virtually a seemless shift change. I also did have a chance to drive the S60R with the 6 speed and loved the trani.
The non turbo is pretty quick with good amounts of torque. The T5's turbo lag is pretty much non existant to to the high amount of torque the car has 236 at 1500rpm, this allows the torque to get you moving until the turbo spools up then takes over, and wow does it take over.
The FWD will give you better acceleration(on dry pavement), with the AWD you get hold of somebody on slightly wet or rain and it is a blast, I have yet to spin the tires, not that I need or want too.
Needless to say I love the car it is a pleasure to drive all around. The manual will give you better gas mileage as well.