Ok So I started from scratch and made my own Palatino from Truetype fonts. There is a nifty little miktex thing for this which does everything you need.
http://www.mtfi.drzoom.ch/ Now my on screen fonts are great, no funny bits hanging off the T and D. (they are type 3 fonts but T1 encoding so they look fine) I can still use the postscript fints in my print version. Hope this is useful to anyone else having this problem. Geoff