1. Can the Worcester extension parts be used externally? This is the
most important bit as extending internally could be very problematic

Yes.

2. If No.1 is possible can the vertical outlet be used on the side
wall of the house? The diagrams on the product information show this
part on roofs but it would be helpful if this can be used on the side
wall near to the back window.

I don't think you can use the vertical terminal on a wall. They have a
technical number, which you could call for advice. When I called, they said
I could use the horizontal flue turret adaptor off the boiler (which came
with the boiler), go horizontal, use a 90 degree vertical and end with the
vertical terminal. Such a route might save you a 90 degree bend, or allow
the boiler to be mounted further up the wall.

If none of the above is possible then we'll probably have to resite
the boiler in the kitchen which, although possible will be a real pain
and will completely cock up the plans for our new kitchen

You could always use enough vertical extensions to get up to the roof line,
where the vertical piece would be allowed. This would probably be cheaper
than moving the boiler. Also, depending on the layout, you might be able to
go horizontal after you reach a convenient height. However, this might look
a bit weird if you don't have a rear extension or similar feature to hide
it.

I wonder why your plumber allowed the flue to be installed directly onto a
shared path?

Christian.