I've managed to get WAP over GPRS working now - these intructions from O2 are what I followed - except that I first deleted teh existing connection (Right-tap on it and select delete):
Xda II GPRS WAP manual settings Pre-pay
It is not possible to select the 'Prepaid' option within 'My Xda' Connections in the O2 Active UI on the XdaII - 'Postpaid' is selected as default and cannot be changed.
To use the XdaII with an O2 Prepay SIM then the WAP settings will need to be changed manually - note that it will not be necessary to carry out a hard (full) reset in order to complete this.
IMPORTANT - once the WAP settings have been changed, if a hard reset is carried out at some future point, then the settings will automatically be re-configured back to Postpaid and they will need to be manually changed again..
XdaII Manual Setup - GPRS WAP (Prepay)
Tap Start > Settings
Tap 'Connections' tab
Tap 'Connections' icon
Under 'My Work Network' tap 'Manage existing connections'
Tap 'Edit'
The 'Select a modem:' drop-down box should be set to 'Cellular Line (GPRS)'
Tap 'Next'
Access Point Name: payandgo.o2.co.uk
Tap 'Next'
Username

ayandgo
Password: password
Domain: leave blank
Tap 'Advanced'
On the 'TCP/IP' tab, only 'Use server-assigned IP address' should be selected
Tap the 'Servers' tab
Only 'Use server-assigned addresses' should be selected
Tap 'OK'
Tap 'Finish'
Tap 'Proxy Settings' tab (*Note, the soft keyboard may be hiding this tab - tap the keyboard icon at bottom right to clear this away)
Ensure that 'This network connects to the Internet' box is ticked
Ensure that 'This network uses a proxy server to connect to the Internet' box is ticked
Tap 'Advanced'
In the 'WAP' field (Server) enter: 193.113.200.195
In the field to the right of this (Port) enter: 9201
Tap 'OK' and exit
Once you have installed the settings into your handset and saved them, please switch off your handset and switch it back on. This will activate the settings for you.