I've just had one of those 'Duh' moments. I now realise that when I upgraded to 2.7.12, I also installed a fresh version of Ubuntu 10.04 on the milling PC. I just copied over the old stepconf config between the two installs of Ubuntu and had assumed nothing had changed between the two. On closer inspection I now see that I had set the username of the fresh install to 'cnc' whereas the old install was 'andrew'. The copied stepconf obviously had the original PROGRAM_PREFIX pointing to /home/andrew/linuxcnc/nc_files instead of what should've been /home/cnc/linuxcnc/nc_files.
As you were. :blush: