It's working =)
Finally got to the bottom of the drop outs / glitches.. Some were my fault in the code, some were due to a dodgy cable feeding the HD PVR from the set top box. With the replacement cable in place, I had it stream for 12 hours straight with no reported dropouts.. that's close to a record for this unit =).
With the new cable in place however, I could still make it glitch, but only when recording.. the very time you didn't want glitches ;p This was while writing data to a network share, mounted via cifs, and the glitches became more frequent if the same network share was used via another client.. all of which got me thinking...