I've just taken another look at it and yes the problem persist on another fresh machine with Windows 7 with
"Sorry couldn't add backup client, error -560 (invalid private/public key)"
Funny thing is that I tried it on a Retrospect 7.5.387, it gets further ie asking for a password but fails the password check.
The Next version, will it be an incremental upgrade or do we have to purchase an upgrade.