Can't get Port A connection to Dynamic C to work

Hi all, perhaps someone here has gone through this issue: I am using the RCM5600W on my own board. I brought out Serial Port A (PC6/PC7) to an external connector (as well as the SMODE pin.) To this is connected a board with a couple of switches (for /RESET and SMODE) and an RS-232/TTL convertor (MAX3222). This is then connected to the PC via an RS-232 cable. I wrote a small loopback program via the development board and installed the RabbitCore back into my board. Using Hyperterminal I can see the loopback working so I know that all of the hardware in between works.

However, when I pull SMODE low Dynamic C will not ‘see’ the Rabbit processor and I cannot download code/debug/etc. When SMODE goes low the Txd line also goes low. Is this normal? Is there something I have forgotten to implement?

Thanks for any and all help.