Thanks for the advice. I have just changed the theme to Twenty Twelve and the sign up works.
Is there something I should be looking for particularly in the Flexform theme to nut out why it is causing issues with sign up?
In the Twenty Twelve theme once the user receives the email they are prompted to follow a link to activate their account. Upon clicking they are taken to the Activate your Account page. This page says Invalid Activation Key. Is there something else that I am doing wrong?
I have looked through previous threads regarding the Invalid Activation Key and have not worked out what to do with this.