Too much!
After wasting 4 hours trying to install PyDev 3, I moved back to 2.8.2 and used the drop in technique instead of Add new software and it now works!
Download 2.8.2 from sourceforge
http://sourceforge.net/projects/pydev/files/pydev/
Uninstall PyDev.
Simply unzip the contents into the dropins folder below eclipse.
Restart eclipse.