Found the answer re how to use INI files - Excellent tutorial:

"Updating SQL Server Connection Properties from the DTS Package INI File"

http://www.databasejournal.com/features/mssql/article.php/3073161

The next step I guess is to create another package which will copy the template (ActiveX script using the FileSystemObject) over the top of config.ini.

I can run this package once before running any other packages. The only issue I have is to make sure that when I run these packages as jobs that I make sure the default instance and the new instance are timed so they do not run at the same time.

I will be pleased to hear if anyone has a better way of doing this.