Ok I have resolved this now ... I fixed the above error by using 7zip to extract c32box.c32 and vesamenu.c32 as advised by others on another thread.
Thanks to all for your suggestions and time though ... :)
I have read that this error was happening because I have used an older distro (Slitaz 4 stable from 2012) to make the USB install as it contains and obsolete version of extlinux.bin?