Our windows have excessive fogging, after driving and car is warmed up. on 2006 Volkswagen Jetta TDI

While driving condensation slowly starts to appear, temp is on warm fan is on 2 and the control def/floor heat. We turn the fan to 3 or 4 in order to remove condensation. Instead windows complete get fog out and then it tries to clear itself, however they never clear properly, or completely. Dealer states nothing wrong with car

Do you have a sweet kind of funny smell in the car? (like the smell of coolant) It is possible the heater core is starting to leak which would cause this sort of fogging on the window.
1 more answer
How about the air circulation? Is it on air recycling from inside or air comes from outside? Is the A/C compressor comes on with defrost? It should.