Just a quick post to say it's fixed
Took the caliper apart again and refitted the piston, everything looked ok. Yet the problem disappeared when reattaching it, maybe an uneven piston?
Either way that sorted out what was left of the binding problem.
The reason the rear wheel wasn't spinning freely, a dry chain with tight spots.
After lubricating the chain thoroughly & again once the chain was warm, the bike is sweet as a nut !
Obviously need to look at a new chain and sprocket set in the very near future.
Thanks for the help everyone, got there in the end
