I always switch it off at the mains socket at night. In the morning everything seems fine, then after a while the source button stops working, and when I turn the TV off from the remote control the blue standby light keep flashing. I can't find anything in the manual to explain this.

Does this sound serious and do you think it is likely to break down completely over Christmas?

Go into timer menu and delete past timers that you have set for USB/Scart recording or have accidentally set without even knowing when using the EPG, then unplug the TV from the mains for 20 seconds. Or go into "Setup" and do a "First Time Installation" this will delete all the timers and retune the set. Well known bug on this Vestel manufactured TV.

Thank you so, so much, in_focus. I did everything you suggested and it's fixed. There was stuff in the timer menu that I didn't even know was there! Very grateful

It's a pleasure, I'm in the service trade and the first few times I came accross this it nearly drove me mad. I alerted Vestel when I worked out what was going on and the reply I got was "there are no bugs in our software!!!".

Of course all software has bugs, some minor, some major, this bug is still present in their latest models and Vestel have never ever done an over the air upgrade for any of it's past TV chassis EPG bugs.