Hi. 
Well... during my attempts to fix the SQLiteC issue I performed a clean boot, including disabling all non-Microsoft services and startup items in task manager. This appears to have fixed this VDS.EXE issue and the SQLiteC issue in one go.
Whats really puzzling now though is the fact that after running the clean boot etc I restored all services and startup items. I was expecting the VDS.EXE issue to come back after that but it didn't.
Anyway. Thanks so much for all your help. I'm very grateful. Sorry if I've wasted any of your time.

Well... during my attempts to fix the SQLiteC issue I performed a clean boot, including disabling all non-Microsoft services and startup items in task manager. This appears to have fixed this VDS.EXE issue and the SQLiteC issue in one go.
Whats really puzzling now though is the fact that after running the clean boot etc I restored all services and startup items. I was expecting the VDS.EXE issue to come back after that but it didn't.
Anyway. Thanks so much for all your help. I'm very grateful. Sorry if I've wasted any of your time.