Basically I plug my I-Phone in to the car, the car registers it and charges it but only plays the music out of one speaker, when I use the AUX lead its fine, so I know it's not the speakers.... Any idea? 
So the music plays but just out of one speaker?
Does it show tracks etc on the head unit or on the DIS?
Sounds like either the cable is faulty, your iphone connector is faulty or the media interface is faulty.
Does your iphone play fine from both speakers if in a dock in the house?
The media cable in the car has to bend quite severely to fit in the ipod/iphone if it is kept in the space of the arm rest so its possible one of the speaker leads has sheared inside it. Keep the lead flat and jiggle it about to see if that helps at all.
Anyone near you with a VW as that would narrow things right down. i.e. does your iphone work fine in their car or does theirs work fine in yours etc.