So one of two things got it all working perfectly...
I actually went to
Mimo Monitors - customer support and installed the win7 Beta Touch screen driver (manually uninstalled and installed new driver rather than let Win update itself)
Got TB running, started IL2, alt-tab'd out of IL2 into the calibaration app, went thru the calibration...quit IL2, restarted all again -> works perfect
Oh and I did use a Wacom stylus to calibrate the screen so may have been super accurate which may have helped
OK so one of 3 things or a combo of one or all the above - hope this helps someone