Again, thanks all for the input! And thanks to larryD for drawing it out.
Got it built on a protoshield and all seems to be working 
I used 1300R resistors in the end to be on the safe side and through them I am measuring 9mA and picking it up on the digital pins so it should be fine.
You are right about the Arduino regulator. Its mildy warm with the arduino only, but gets too hot with the ethernet shied on, I measure 230mA with the shield attached 
. Is there a way to reduce this? This circuit will be running 247 so would be nice to get it down a little.
Obviously I won't be able to power the arduino from the alarm now, for heat and over current reasons. Guess I will just get a 9v wall adapter or similar.
Thanks
Edit: Obvious things I can think of is to disable all the LED's, I notice the shield takes 5V from the arduino then drops it to 3.3V, I don't suppose the 3.3V on the arduino is enough to power the shield is it?