Well, I know no one replied to this thread but I thought I'd add in what the problem ended up being, so that others with a Sunbeam may know if it happens to them.
Burnt metallic taste/smell etc means that the thermablock is broken (that is- the water heater). To fix it meant forking out $$ at about the same price as a replacement machine.
The repairer said that he didn't keep replacement parts because of the cost factor. After a little research I found that this machine is so tightly packed that trying to repair it would be a nightmare anyway. A friend who had this machine replaced under warranty mentioned that the repairer said "this is what goes wrong on Sunbeam machines most of the time." (meaning that the thermoblock fails).
Would I buy the machine again? No - it was a good machine to learn with, but I definitely want more reliability in a machine - it lasted 1 year and 4 months.
Would I recommend this machine to a person starting out as a home barrista? Yes - IF they only made a few coffees a week (I averaged about 10 a week, some weeks double that).
So where to from here? Well - I've gone and bought myself a Rancilio Silvia - I'm picking it up tomorrow. If anything goes wrong with this puppy, at least the parts are replaceable.