Harsh and rattly is not a description that you hear often when it comes to K11's. When you consider that most of them are still on their original suspension then I would suggest that yours has some issues. Assuming that it's all original and not f**ked over by a previous owner then start...
Must admit that if I had to make a criticism of the original manufacturing standard of my K11 that it would be lack of paint. At first I thought that it was poorly repaired prior accident damage but then realised the little bugger had never been painted properly in the first place!
Lots of good work accomplished(y)
The seemingly homeless connector may be for equipment that was never fitted to your spec of car, this is very common on cars that are sold in various trim/equipment levels in multiple markets. Where distributors are driven off the end of the camshaft the dogs...
Methodical does it every time, step by step by step. This way you aren't struggling with "what did I forget?" syndrome. Been there, done that, many many times ;)
First of all hello and welcome, I'm 67 so I think I'm winning the old fart contest. I'm actually old enough to have bought a brand new K10 in 1987. This is a seriously nice K11, I would be more than pleased to own it. I would certainly better the dealer's derisory joke offer!
The brake components are so cheap and readily available I wouldn't hesitate to change the lot. Whilst you're at it consider braided flexi hoses, it'll sharpen up your pedal feel.