OK found the answer.
First get rid of or stop mdns - you can disable it or do a bad thing which is what I did and remove the packages (with a force remove of dependants) - in retrospect it would have been better to disable.
configure base-feeds.con in /etc/opkg to point to alex's library
install avahi - which will load dependancies.
that it - I can now ping my esp8266 via mearm.local - all the traffic goes via wifi!
The problem I had before were threefold.
1. mdns was still active an running
2. I had downloaded just the avahi package from Alex's repository
3. because I had not pointed to alex's repository, the dependancies had not downloaded
O well - on to the next showstopper!