Ok so here is my in-depth analysis of this, covering multiple points:
-Design
-Engine
-Reliability
-Quality
-Driving experince
Point One, Design.
The Audi A4 B7 has a very "soft" design language, no key elements and no major returning concepts. The Alfa Romeo 159 has a sharper look but still retains fluid volumes, key elements are present and so are returning concepts.
Speaking about proportions the 159 is longer, wider and less tall than the A4, providing a sportier look. The wedge shape gives the 159 a rear end that sits higher, along with the extra width, better proportions in the headlight-to-grille ratio and more defined A-C pillars give the 159 a much more planted and sporty look.
In the A4 we see less defined A and C pillars, bad door handle placement, very few defined lines, smaller muscles over the wheel arches and overall a less curated look, clearly more oriented to being average.
The 159 has non-carenated headlights, grille and that front line in crome signs of elegance.The front end is horizzontally divided in three sectors: One for the headlights, one for the bumper and one for the air vents. Still In the front we can see a total of NINE circles and eight in the rear. All of these circle theme is applied to the interior too, the center console has 3 circular vents, 3 circular gauges and the driver side has circular gauges for the speedo and rev counter inglobed in other circles, inglobed in the telescope shape typical of alfas. Good design detail is that the singular divided light bulb design of the front comes back in the tailights, this time covered by glass.
So we can say that the Audi is clearly a more bland design in comparison to the more defined and curated Alfa, something not unexpected since the Alfa won multiple awards and was designed by Car design legend Giorgetto Giugiaro.
Use for comparison: https://www.carsized.com/it/automobili/paragonare/audi-a4-2004-sedan-vs-alfa-romeo-159-2004-sedan/fronte/
Engine Choice varies:
The 159 offered the reliable but underpowered 1.8 MPi and the not so bad 1.9 JTS.
The A4 offered the underpowered 1.6 MPi and the 1.8T as entry level petrol engines.
All of these engines were decent but not great because they were underpowered, the 1.9 JTS complexity often made it less reliable.
Moving on, the 159 offered the high maintenance 2.2 JTS, the GLORIOUS all italian, reliable yet powerful 1750 TBi and the 3.2 V6 JTS which in contrast to the smaller siblings was decently reliable, more powerful than the Busso but less emotional.
The A4 offered the reliable but very slow 2.0 MPi, the decently reliable but delicate 2.0TFSI in various forms and the better 3.2 FSI that though was still delicate when talking about timing chains as all TFSI/FSI were. It's worth mentioning the 344ps S4 and the V8 powered RS4 for which Alfa did not make a competitor.
Diesels were in both reliable, the 159 offered the best seller 1.9 JTDm in 120 and 150PS form, the 2.0 JTDm in 136 and 170PS form and the iconic 2.4 JTDm in 200 and 210PS form. All of these are considered extremely reliable units, with the only problems being classics of diesel motors: EGR Valves clogging and DPF issues, usually maximum a 150€ fix. It's worth noting that the 2.4 JTDm, being a 5 cylinder and bigger displacement unit is prone to heavy front-end wear due to more weight in the front axle.
On the Audi side things are more messy.
The 2.0 TDI is as we know very reliable, and a strong engine for work, provided that it is well looked after. The 2.5 TDI is were the bad things start to appear, it's considered a risky and high maintenance engine thanks to camshaft wear, fuel injection pump failures, and expensive upkeep, particularly with high mileage. The 2.7 TDI follows it's smaller brother, issues like timing chain, multitronic transmission and piezo injectors are present due to a high complexity and it's not cheap to fix either. The 3.0TDI is the complete opposite, very reliable engine and long lasting, however timing chain failures are a thing and prices here again arent cheap.
I have little to no experience with the Audi, my uncle has a B8 2.0TDI and it infact had issues and looking online the diesels dont seem to be tanks as most diesels are, and i know for a fact that the JTDm is.
I'd say petrol engines excluding the 1750tbi and the 3.2 JTS go to the A4 also because the 159 does not have a high performing option. Diesel engines go blindly to the 159 for the reasons i listed.
For the reasons listed in the Design section, i think that the 159's interior is fresher, sportier and in general different in comparison to the A4's interior. I remember my uncle's A4 B8 and yes the interior felt more solid but the materials were on par...looking at the interior pictures of the B7 i think it is quite bland and not curated at all.
The 159's platform was supposed to be for E and F segment cars, thats were the weight comes from, but this has a benefit: ride quality. The Ride quality is sublime, over 60kph it eats the road, while being confy it still lets you feel the read texture for dirving experience.
talking about driving experience, the 159 still wins, this time by a mile thanks to: Sharoer steering ratio, torquier engines and a better suspension layout.
As said by Quattroruote: the Alfa "159", which remains, indisputably, the best front-wheel drive sedan in its category. Here: https://www.quattroruote.it/prove/2007/brio_diesel_lexus_is_220d_alfa_romeo_159_2_4_jtdm_e_bmw_320d.html
In conclusion (as expected) i prefer the 159 because it is a more sporty, purposeful, better designed and more special car compared to the boring looking A4.
