Spent some quality time with the boiler today, a little more confused now so here is where I think things are at:-
With no central heating on, with the right hand preheat switch up or down, when you turn a tap on, water runs through the boiler but nothing happens and the microswitches above what the parts catalogue calls the flow switch (diverter in bottom left hand corner?) are both open.
Switch on central heating for 3-5 minutes with the right hand control switch (preheat?) in the top, solid colour square position, the water in small heat exchanger (small tank bottom left) gets hot. At this point, the left hand microswitch plate rises up and switch is made and the right hand one has a gap above the switch button of about 5mm which suggests the wax capsule is moving. Didn't notice this the other day but I did put a little WD40 on it 2 days ago, maybe that has had some effect?. Turn on hot tap now and water goes hot until the small tank is empty then runs cold, the boiler does not light in response to hot tap being opened.
At this point (with central heating running) if we leave the hot tap on and manually press the right hand microswitch, we get hot water at the taps for as long as we keep the switch pressed.
Joe informs me that three years ago the boiler had a brand new solenoid and pcb and says that since then the temperature adjustment dial is not correct anymore, even when on low, the temperature is higher than it's ever been and the radiators are a lot hotter.
Hope this gives more clues, Regards,
Paul.