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From what I've read so far, this has to do with heat necessary for the catalytic converter to absorb NOx -- without enough heat, NOx isn't absorbed, so in emissions test mode, they're just running the engine in such a way that more heat is generated to make sure the cat works properly.

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Fuel economy improves at higher temperatures, but NOx production increases dramatically then. Conventional catalytic systems cannot keep-up so either a selective catalyst (expensive) or improved egr system (performance sapping) must be used.

Interesting! How much heat are we talking about here? When an engine is just running in normal operation it generates a fair amount of heat naturally. I guess that's not enough?

Diesel engines run with a surplus of air so they only burn the fuel they need to. They don't really generate a lot of heat unless they are under load (relative to gas engines). Just cruising down the highway a diesel will not need much fuel and will run fairly cool.

The owners manual for the VW TDIs actually warns you to not try and preheat the engine by letting it idle in the winter, because it won't work.

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