Having slept on the problem, of course I managed to sort it out today. I was mistakenly using the beta 1 release, which of course suffers from the bug with xerces that I found. I replaced it with the latest beta 3 release, and that seems to have solved the problem. Sorry to trouble you all.
Leo Soto - thankyou for the advice and the warning. Out of interest, I tried running "ant full-build" but it failed - "/../jython/build.xml:250: informix jar not present". I don't know if that is of interest to you or not. Anyway, I eagerly await the production release of jython 2.5 :-)