Yes if the BT line is no longer in use, you will get charged £130 to reconnect.
In general Virginmedia broadband should be better than any broadband via your telephone. VM use fibre optic cables which are capable of moving data much quicker than any telephone line.
Why don't you call VM and see if you can get a deal for a complete package, TV, Phone and Broadband. It may be cheaper than you think.
Do you research about what other packages may be available e.g BT and Sky. Sometimes if VM are aware that you are considering swtiching to other companies, they are willing to do a deal.