Yup - a wierd one.
On restart Server Admin shows that the Serial Number is invalid!
Users could not access their email and authentication in general seemed screwy - though I could log on using Server Admin and Terminal.
So back to Server Admin - enter the serial again, the server thinks for a bit and then wipes it again - refusing to accept the valid serial that came with the copy of OS X Server.
A call to Apple gave the answer.
Reboot the server, remotely via Server Monitor or typing reboot into the terminal and the serial number is recognised and everything is fine.
But for 4 hours I was freaking out.... not very happy.