Okay, the verdict is in. I got a copy of the 1.5gb unglitched version. Firstly, its different to the 1.5gb trial version you can download off the marketplace. But I'm afraid it does indeed have its own DRM (Digital Rights). The 1.5gb unglitched version will only launch in demo mode if all you have ever downloaded off the marketplace is the 1.6gb glitched version. If you've previously downloaded the unglitched version, you'll have the DRM attached to your gamertag and you'll be fine.
So as it stands, the only solution is to get your hands on the 1.5gb unglitched version through file transfer from someone who has it, and have a profile on your console that has the DRM for that version.
So annoyed at this, but a big thankyou to everyone who helped me at least to find out this much.
So to summarise. There are 4 versions of the game:
1. Day 1 Unglitched 1.6gb Version. Not on the marketplace and has its own DRM. If you don't have the DRM it won't even launch.
2. Glitched 1.6gb Version. On the marketplace, has its own DRM. Not sure what this version does if you don't have the DRM.
3. Unglitched 1.5gb Version. Not on the marketplace and has its own DRM. If you don't have the DRM its launches in demo mode.
4. 1.5gb Demo Only Version. On the marketplace and doesn't need DRM.
So four different versions of the game, and three different DRM's. SEGA really made a mess of this.