Thanks Daniel,
After following your suggestion I tested the arduino again and found it functioning well within spec. Seems that the sensors are the problem!! :
Your suggestion to put a cap on the AREF helped to halve the noise though....
I am now able to scale the input to a viable range to use the sensors, now it is apparent that the settling period of the sensors is not what I had expected and I will have to change my tack slightly in design.
Looks like its back to the drawing board......
Big Thanks 
bds