Thanks to everyone for suggestions and help.
OK, so I'm gathering that whether I use Blender or Maya, to create my own skeleton/armature (instead of trying to use the SL skeleton from avatar.blend, I should be OK.
I managed to get the Bone weights copy script to stop dissapearing off my toolshelf in Blender, it was because there were no objects or vertex groups selected ... lol simple i know.
So i can get my 'Bella' character, which is a simple model to fit the SL skeleton, lined up perfectly, select her, then select [with shift] the skeleton and hit ctrl P.... I get the options up, do that and i can pose Bella as normal. but if i export her at that point she hasn't been 'made real' as things used to be for blender 2.49b... i have it, but cannot get python to work with it, so i got the Bone Weight copy script for 2.59
as soon as I copy the bone weights, [thinking I am there finally!] blender ceases to function.
I dont know if it is because Bella is a bunch of seperate objects which are merged into one [in which case I need to make a different test mesh model] or something else...
I am beginning to think that all my frustrations are because of me wanting to stick to that avatar.blend skeleton i've been using.
Making an armature in maya or blender is simple enough for a simple character, so I will try rigging a new charater with my own armature instead of using the SL skeleton.
Again thanks for all the help and advice, I'm sure if i keep plugging away, i'll have a dancing sheep soon enough in SL lol.
By the way, if anyone would like to see one of the characters i'm trying to bring into SL then look here
http://www.youtube.com/watch?v=C2Nk5Rmuyec