[ilmiont]

Well to put an end to this spectacular thread of misdiagnosis, red herrings and overthinking (by me)...

Took her into the local Volvo specialist this morning, got the call this afternoon... bled the brakes and problem solved.

Advised that brakes are in good condition all around (previous owner had mentioned they were done recently) but there was quite a bit of air in the system.

I'd come to that conclusion myself over the past few days, driving on some short, careful trips - pedal was soft on first press but with pulse braking it would quickly firm up and give a very sharp action by the fourth or fifth pulse. No sign of the pedal sinking or the brakes misbehaving in any other way so I had another U-turn in opinion and went in with an optimistic mindset this morning. Not observed any fluid loss anyway!

Apparently I also have a working handbrake now, and that all it required was adjustment... shoes said to be in good condition but the cable was hopelessly misadjusted. (I was having to pull it all the way up, and sometimes tug even further, to get anything from it.)

Car's now staying to have the rest of the work done but I'm now much happier and it now seems once again that my inner sense saying "there's faults but it's a bargain" was correct.