Thanks Koondawg, It's amazing that no one has noticed before! I just went into a mission & selected a VIIC (1942), then went in guns blazing, with my finger poised just above the "C" key till I get a direct hit, generally never to come up again, but that's beside the point, just stay on an external view & you should see this nasty cloud hovering above the boats position, though the further the boat goes down the further the cloud rises!

@ Von Zelda, I did replace the zon files but still had the problem, have now replaced all files & still there, I will look at the differences between the VIIC & VIIB dats.
Edit: You can't just rename the files, they make calls to other files, sim, zon, etc with the same name, so renaming to VIIC the dat will still call for VIIB files!