I seriously believe it's something to do with the port config as Charles has mentioned. It's as if the code is ignoring the configuration of this register.

I did think that the problem may be due to the fact that the RTC uses C.3 and C.4 for SLC and SDA lines but if I have read the datasheet correctly, If bits 3-0 are set to 1100 and bits 6 & 7 are set to 00 then P1B, P1C and P1D are set to port pins, but then these appear to point to pins D5, D6 and D7 rather than Port C pins - so that would rule that out

Given the fact that I can comment out the settings for the register and the code behaves exactly the same way does confuse me (easily done) and the fact that channel 2 works ok and it's channel 1 that is screwing up