Hi, and welcome to the forum 
I’m afraid you’re not going to like my response very much … or maybe you will, who knows.
1) what type of machine should I go for? I'm told that Dell are very good, but which models in particular? Also I hear that Lenovo are very good for audio, does anyone have any experience with these machines?
It may be easier for you to give us a few models you are considering, and us to tell you if there are any known issues with Linux that require workarounds … but these days pretty much anything will run Linux.
It may also help for you to look at sites such as:
http://www.linuxemporium.co.uk/hardware/hardware-laptops.html
because if you get the same hardware, you’re pretty much guaranteed it will work.
or you can BUY from them, then it WILL be guaranteed 
You’ll probably be able to get the same or similar hardware cheaper if you want to self install, and don’t require the Linux support that places like that should give you.
2) will I be able to run all the same programmes like reason, ableton, pro-tools, cubase etc ?
Erm … NO, Linux doesn’t run Windows applications natively, though some Windows applications will work to varying degrees in WINE (a Windows compatibility layer) … Linux has its own software, most of which is free.
If you want to see how well specific Windows applications run in WINE … search the WINE application database:
http://appdb.winehq.org/objectManager.php?sClass=application&sTitle=Browse%20Applications&sOrderBy=appName&bAscending=true
If you want a VERY incomplete list of Linux equivalents to well know Windows software, see here:
http://linux.co.uk/2010/06/linux-alternatives-to-windows-software/
3) is there anyone in london that I could go to for help setting my machine up?
Dunno … but that’s what we’re here for.
apart from recording music, I would just be doing all the normal things- surfing the net, watching films, word documents, downloading music, oh and iTunes, I am an iPhone user.. Is that all straight forward enough?
Yes to everything except iTunes … currently Apple don’t do iTunes for Linux, though with most iPods music can be transfered/synced in applications such as Banshee, it currently doesn’t work on version 6 iPod devices which probably includes your iPhone.
If you NEED iTunes, your only option (at present) would be to set your PC up as a dual booter (where you’d select Linux or Windows at bootup), or to run Windows in a virtual machine “inside” Linux (using something like VMware or Virtualbox), then run iTunes inside Windows.
A thing that attracts me to Linux is that it's open source which means (among other things of course) cheaper, to me.. So I don't have much budget for a machine, around £500 maybe? What's the best for that kind of money?
If you’re still interested after reading the above …
are you definitely thinking of a Laptop, or a desktop ?
if a desktop are you considering self building, or do you only want a pre-built system ?
and also if a desktop, do you also require any peripherals (Monitor, Keyboard, Mouse, Printer, Speakers, etc.) ?