Thanks Bob. I have uploaded two new photos (which have the correct labelling - 2volts per cm) I am using a 10-1 probe.
The good news is I have solved the problem!
I hope this makes sense. I watched the oscillator diodes. The distorted note always stopped when the sixth oscillator got to play the note. So then I would play a low note six times and then a higher note, which would be distorted until it reached to the sixth oscillator.
I took some photos of this distortion (probing resistor 149)
As mentioned in an earlier post, the sixth oscillator was also the one which lifted an octave rather than add a sub octave, when the sub octave was selected. I probed around the 4027 on osc 6 and it looked very different to what was happening on the other oscillators. (sending out a wave twice the frequency).
I put in a new 4027 today and it fixed both problems (the sub octave and the distortion)
I have uploaded a more basic sound demo- (you can count the 5 distorted notes then the clean 6)
sequence:
6 low
5 distorted high
1 clean high
6 clean high
repeated twice
And added some more photo's ( I realised afterwards that I still had the osilloscope set on dc......but it shows the problem at least
Thanks again to everyone for helping out. Thanks Bob for helping me understand my old oscilloscope a little better.
If anyone understands why a faulty 4027 would cause this effect, I'd love to know.
I will probably have other issues but if they are unrelated to the klm366, I will start a new thread.