Thank you both for your help. i got it to work now. i added a 0.1uF cap to filter the power supply to the digital pot. i changed the spi control register to B01010000. i made_sure that i was only sending single bytes and not ints in place of the data byt for the digital pot. i also got rid of some useless things in the code. you can see the updated and working version of the sketch in the link here: milkcrate.com.au. (its an RTF file called "spi_pot_working).
Thanks again for your time, i appreciate it.
Seb (from adelaide, australia)