Thanks for all your answers. I think you're absolutely right as it seems to be about the Calibre Kobo driver. I went back to the blog entry I posted and read all the comments to see if there was something I was missing.

Thanks so much to Joel Goguen. He has published a driver which sorts out the problem of covers for kobofied files. I'm so happy now!!! Just follow the instructions

https://github.com/jgoguen/calibre-kobo-driver#readme

His comment is at the very end of the blog entry
http://dsandrei.blogspot.co.uk/2012/...19243870487287