If I go s-video on the PC to the s-video input on the TV it is in colour.
The cable I am using has an s-video connector on one end and a AV connector on the other end. This is because it feeds into a 4 way switch box (so I can flip between cable, PS2 and PC).
I have taken the switch box out of the loop by connecting the PC directly to the TV and that doesn't work.
If I get a long s-video cable I can connect the PC to the TV and get colour. The only reason I haven't done this is because the existing cabling (from PC to TV) is contained in ducting that doesn't seem to want to open without pulling it off the wall, which is a pain. But given I still haven't figured this problem out that is probably what I will end up doing.