Yup, after reinstalling the entire Windows OS (XP SP2) and doing a Windows Update, I just plugged in the BT device, and the exact samae thing that happened above happened - it won't install it without a third party driver
So back to Widcomm I guess, and see how it behaves.
I think I might just buy the other two devices I have found (£18.25 inc postage for a pair) which the seller is including a compatible older version (1.3.2.7) of Widcomm with it to help me along. But if they do as he says, they should both run fine on XP's built in MS stack
So we shall see....