I saw that car at Castle Combe last year, and it is genuinely quick, it's packing just over 200bhp IIRC and is stripped out with lightweight body panels. It's also running a decent LSD and suspension setup. It's a well setup little car that has had silly money spent on it. Not that I would have done it all to a 106, but it is a well done little car, and infinately better that the countless chavved up 106s that are around.
As for his driving, I don't see anything particulary dangerous. He's getting on the power mid-bend using his diff to pull him round, I see no 'twitchyness'. As for using the whole road, again no problem with that if the road is clear and you have good visability. Infact they actively teach you to use the whole road in advanced driving courses AFAIK.