Guys, thanks for your thoughts.
First, I tried unplugging the led strip and using the pin13 LED to determine whether the manchester code had been received and decoded. The problem persisted with this setup, indicating, as Ray says, that a code clash is more likely than electromagnetic interference.
Ray, your idea of reducing the updates .show() to only those instances where a state has changed is great and I can make use of it in my main program. However, the code above is a simplified one to try and sort the problem out. In my main program I have a default setting (unless a 4 digit manchester encoded message changes the indicatorState) where a single LED is lit for 50ms before turning off and the adjacent one turning on, to give the effect of a light running along the strip. This 50ms interval can go to 70ms but anything longer undermines the smoothness and looks juddery. It would be great if I can continue to use this 50ms update rate while still listening for the manchester messages. I have upped the transmission rate to 2400 on the manchester setup to try and fit a message into a smaller time window but I'm not convinced that it has made a huge difference (no effect). I'm using atTiny85 without an external oscillator to generate the tx, so can't go higher with tx/rx rate.
So, what next for this investigation? You mentioned disabling interrupts and I read (but didn't fully understand) the linked thread about serial problems. What might be a fruitful next step? Thanks, Simon