Update on this problem,seems the only issue I had was that the telnet method of verifying IMAP authentication that works on Courier just doesnt work with Dovecot. I tried connected to Dovecot with an IMAP client (IMP webmail) and I get a load of info logged about authenitaction. Duno why I cant test via telnet but anyway, now I have fixed my config probs and have a working Dovecot server,
thanks Andy.