OK I have put another H3G stock rom on and this does not work either.
After looking into this further I have found somewhere that if the phone is a replacement one or something was changed from manufacturer and providers with regards to databases for unlock codes then the one provided may not work.
Well my phone went into the service centre and they fixed it but stated after testing they decided to change the mainboard. I suspect because it was originally a CID 1111111 with S-OFF(unbranded as HTC described it) as it was delivered first day they came out. Rush job to get to market and didn't get branded to H3G_001 and S-ON I suppose.
Anyway I suspect that because the main board has been changed the the unlock code has also changed and not been documented or changed on the database for the codes. So they are providing me with the original code not the new one and the letter for the fix state IMEI code previous and new the same, so they must have just reprogrammed that and forgot about the unlock code.
Is there a way to read these off the phone, NVR or something?