Thanks to everyone who has provided advice. I now can confirm that all is working satisfactorily!
Up until now I have been following an E61 exploded parts diagram for the Isomac Millenium when reassembling the machine after a big catastrophic failure. The diagram indicated 2mm silicon gaskets between the brew assembly and the infusion assembly and the main lever body.
Having ascertained that the infusion body gasket was preventing the infusion/exhaust valves to be activated, I removed said gasket and used telflon tape to provide the required seal. This had the effect of moving the valve closer to the cam, SUCCESS! the machine was exhausting after a shot.
However I was still finding that the brew valve was not being activated by the brew lever (locked in place by pressure) so tried the same trick. I removed the 2mm gasket and used tape. This allowed the assembly to be screwed together closer to the cam and SUCCESS!
I cannot rememeber if the machine was originally assembled with the white silicon gaskets but it would seem that they have been the cause of months of re-assembly pain for me! The process has however not been a waste of time. I have learnt so much more about the machine and following input from forum members has recalibrated the machine to hopefully prouduce the best tasting coffe ever!
Thanks again for the help!