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I don't know what year your quattro is, but the '83 that I was looking
to buy definitely had a bearing noise, but it didn't sound like a wheel
bearing. The dealer actually replaced the transmission for free (BONANZA!),
but it turned out that it didn't fix the problem. I looked into it myself
and found that there is an axial bearing on the driveshaft that was making
noise. Audi told me that the bearing was not available by itself and I
had to but a new driveshaft ($600), so I decided to look into it further.
It turns out that the bearing is a standard part that cost less than $10.
If you think that this is your problem and you want more info, let me know
and I can give you a fuller description of the procedure.