Right then.
Just got the car back from the dealers. It was indeed a faulty engine coolant temperature sensor. All replaced under warranty.
I asked the service advisor if there had been a VW bulletin issued about this fault - they said no.
Anyway, on the drive home from the dealers the ECT gauge performed exactly as I used to. Getting up to 90°C quickly and staying there. I'll monitor my fuel economy over the next few days to see if it improves. As others suggested I think it was running rich (hence the dip of about 10%).
Nice it's fixed but slightly peeved it broke in the first place on a car that was only 11 months old.
They even gave me a 1.5 litre bottle of genuine VAG coolant to top up with if needed. Think it might last me a whole lifetime
