I've found the answer to this now. It was all to do with this issue...
http://support.microsoft.com/kb/896861
Before the infrastructure update just entering the FQDN (e.g. intranet.domain.local) for BackConnectionHostNames entry in Method one worked fine. After the infrastructure update I added just the hostname (e.g. intranet) to the BackConnectionHostNames entry and this fixed the issue! :-)