I got an update from HTC Tech Support on this one.
Search for a software update and you should hopefully find 1.29. Once this is installed you'll be able to connect again fine.
Thank you for your patience.
I would recommend backing up your data and performing a factory reset,
to do this please follow these steps:
If your phone is tied to a Google account, your contacts, calendar events, downloaded apps, wireless settings can be backed up, if you
have entered your Google account details in the initial set-up
screens. Please go to , Menu, Settings, Accounts & Sync, tap on your
Google account, then tap 'Sync now' you will see some spinning
circular arrows for a short while, this just means your data is being
saved to Google. When the arrows have finished spinning, the data has
been backed-up (double check this).
Or back up your contacts to the S.D card (For Android 2.1 or later) by following these steps; From the home screen tap All Applications.
Scroll to and tap People. Tap Menu. Tap Import/Export. Tap Export
to SD card. Select which contact Group to export (Phone, Google, SIM
etc.). Tap OK.
Available from the android market is a free application to enable you to back up your SMS messages if desired.
Now your phone is backed up we can perform the hard reset, all data
will be lost that is not backed up on your S.D/SIM cards or online
will be lost.
- Hard reset on Android From the Home screen, press the Menu key> Tap Settings> Tap SD & phone storage> Tap Factory data reset> Tap Reset
The reason I have asked you to do this is because though it may seem a
bit extreme this is the best method for dealing with your problem.
Once this has been done please manually search for an update.
I didn't actually do the reset, I simply searched for software updates and found the new update, installed it and all was well. I'd recommend this first before you wipe your phone!