I am familiar with the Cisco phones with MGCP and SIP. Much is common there, so I'll offer some comments to your Cisco SCCP questions. Also, SCCP is where everything should work for them, right.
1. Change the extension names (At the moment it says '201' and then '201' below it - would like it to say 'Kitchen' on screen, and that 'Kitchen' is calling when I ring someone). I've tried changing this in FreePBX and LinuxMCE but no joy.
A. The Cisco SIP config includes Displayname and shortname.....shortname is what shows on the display.....Displayname is what ships with the Invite as your identity to display.
3 - Use the right hand context keys for direct extension dialling, AND line appearances if possible (ie I am extension 201, I can see 202 is on phone by looking at the screen, and when they come off the phone press it to call them)
A. Your looking for BLF or presence appearances. On SIP you can monitor presence and then mash the button as a speed dial.
4. Any advice on background image - I read something somewhere about changing something in Asterisk but it concerned me the way it was worded in case it upsets LinuxMCE
A. The background image can be served up from anywhere. So if running Apache to serve up an HTML image will break anything, you can put it anywhere. I use dropbox for some of my images or files needed anywhere.
5 - Also have read much on the 'SIP vs SCCP firmware' debate! Is SIP firmware working yet, or is it still best to stick with SCCP? It's working fine, so unless there's a reason to swap (call quality I think was mentioned on one page i read?) then I will stick with SCCP.
A. I use SIP, because I don't have just Cisco phones. SCCP will not replace SIP in the market at this point. I don't see where call quality would be part of any equation. SCCP is a signaling protocol that is Cisco specific and will almost always provide a better feature interaction. Cisco has SIP, but it is a half to 3/4 hearted implementation. I have functioning Cisco 7960 phones, but always suspect the phone before the switch with problems. Who knows....maybe it is the same with SCCP :-)
Jon