sorted,
the thermostat is in the bottom hose, under the alternator, not the top one .its in a plastic housing that fits onto the back of the waterpump housing. 4 8mm bolts easy to get at once you remove the alternator.
i took the thermostat out and put it in a mug of boiling water and it did bugger all. so put a new one in (£7 from dingbro) the temp gauge sits in the same place (half way) but now both hoses get hot (so the coolant is circulating through the radiator) and the fan isnt on all the time.
i could also feel the waterpump impellor with my finger when the thermostat was out and its still attached and turning ok

i hope thats it