LOL - we in the Northern Hemisphere always tend to think that Australians are the only ones who do things upside down <img src="images/graemlins/wink.gif" alt="" /> I'd forgotten you were a South African <img src="images/graemlins/blush.gif" alt="" /> (Guess I should have looked closer)

This description can't possibly be right. The time difference here between GMT and local time is 7 hours. According to this, I should set my watch so that it reads 12 noon when it's 5 a.m. local time. At 5 a.m. local time, the sun will be just rising - at my latitude, it will be southeast, at more southerly latitudes it will be closer to due east. But according to the MPI instructions, it will be due SOUTH.

They have the directions confused with another technique. You are right - your watch should be set to local time (indeed, for best accuracy, it should be local solar time, not local mean time).