Okay, I established that it was most definitely NOT a problem with either the provider or the Linksys 3102. Faxes worked fine if I turned off 3CX and connected the 3102 directly to the provider.
So how does one get 3CX to work with an analog fax? I followed the instructions in (http: //www.3cx.com/sip-phones/linksys-spa-3102-fax/
NO LONGER AVAILABLE. NEW LINK: http://www.3cx.com/sip-phones/) and that does not work. The instructions there point to using a normal extension to send faxes. This does not work. The handshake between the sending and receiving faxes is not completed. From my reading elsewhere this will not work as 3CX does not pass T38 on normal voice extensions. Which conforms with my experience with the PAP2T which does not support T38 and displayed the same symptoms.
So, the 3102 must be connected to a fax extension. I did that and once I realised I didn't have an outbound rule for the fax extension was able to send faxes.
Now..how do I receive faxes? Again according to (the above mentioned guide)I set the 3102 to the extension 888 and disabled the fax server. Didn't work. The calls were not being handled by the system at all. So I turned the fax server back on, configured an additional fax extension (889), set it to forward faxes to fax device 889 and it worked.
So here's my instructions for getting a Linksys SPA3102 to work:
1) ignore the instructions at of the guide
2) upgrade the firmware to 5.1.10
3) leave all the settings at default (T38 is enabled by default)
4) set up a fax extension on the 3CX phone system
5) configure Line 1 on the 3102 to connect to your new fax extension
6) make an outbound rule for your fax extension that allows the leading digit to be left off (remember to remove the strip digit from your outbound rule)
7) set an inbound rule for the inbound number/DID to "send fax to FAX device xxx'