The air gaps readinggs on VCDS are now 3.8 and 3.9 respectively. i don't know how they changed so much because i did not touch anything near the wheel...
do i need to go there and adjust them manually? any tutorials / writeups on how to do what?
Well, 3.8 and 3.9 would explain why the procedure won't take.
Yes, I think you will have to adjust them mechanically. There are some pictures here. Note that you do not have to remove the rotors to make this adjustment; the rotor got pulled for those pictures to show the adjuster.
Please also see the Special Notes section at the bottom of this page.
-Uwe-