No I didn't have to buy a new router in the end.
I replaced the ethernet cable and went through a couple of power reset cycles of the router.
One cycle, I unplugged the ethernet cable, turned the power off, left it for 5 minutes, turned it back on...then when it had a stable internet connection, plugged the ethernet cable back in.
This gave more stability however sometimes still ended up with the issue described in this post.
I then performed another power reset cycle as above and then this seemed to alleviate the problem.
Although I can't confirm this, from my experience I've had, I believe as the router dynamically assigns IP addresses, the router remembers devices footprints on IP addresses...so when a new device is plugged in and dynamically assined an IP address...the router has trouble identifying that it is a new device and therefore has this problem. That's the only remotely logical thing I can come up with from what I experienced.
Also, when you plug in your Xbox, leave it, don't do any tests or try and play a game, I left it plugged in for some time after doing the above and this helped it gain a stable connection with the router I believe. I've noticed with this router than when you plug in a new ethernet connection and try and perform tests, it leads to more instability and dropped connections...I have no idea why.
