Yeah that's what I ended up discovering by pure accident - I was trying to edit the wrong file. I correctly edited the vmdk the first time around but for some reason though I was supposed to be editing the flat.vmdk file the second time around which obviously didn't work.
So I have my problems completely resolved now thanks to the help received here. I went back to my backup 60gb disk then by adding a small empty SCSI drive to the OS and allowing it to install the drivers first I was then able to shut down the machine, remove the small empty SCSI disk, convert the IDE disk to SCSI, re-attach it, boot up and run the startup repair which got everything back to a working state. Plus once it was SCSI I was able to increase the size of the disk and then extend the partition in Windows so I'm all good.
Thanks to both of you for your help.