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Gav, re: the insurance, why don't you consider using Direct Line and take out the insurance for the car in your name. Put your step-daughter down as a named driver, and she will start to earn no-claims bonus as well as that's the policy of DLine... might be cheaper than her own policy.
Re: car, have you considered a Smart ForTwo? I know they're only two seaters, but that's not necessarily such a bad thing for a young driver (less mates in the car can sometimes mean less hassle & danger!!) There are 2002/2003 RHD Passions out there with 50-60k on the clock - very reliable, extremely safe, dirt cheap to run, dirt cheap to service, and she can change the colour of the bodypanels very easily to something she likes!
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