was just looking for a cheapish motherboard with onboard graphics just to try out overclocking really, would rarther start cheap than jump in at the deep end and overclock my new system when I get everything for it
Sounds reasonable, the problem mainly is if your looking to buy something new to clock an Intel® LGA775 chip they want you to pay £££ extra, particularly on a motherboard featuring an IGP
There are a few you can get but the overclocking options are very basic and normally missing the crucial vCore adjustment which is normally an overclockers main tool!
I can recommend two motherboards that are not sold new anymore afaik but I'm sure you could hunt one down at auction, as far as you wanting an overclocking friendly Value IGP-board to help you get to grips with overclocking either of these two boards from ASUS fit the bill perfectly!
ASUS P5K-VM
ASUS P5E-VM HDMI
I've got the E2160 processor, I've read and been told its possible to get a stable 3ghz from this processor with little work, if the motherboard is up to the job
That's true, I had an E2140 that was happy to run at 3.2GHz so an E2160 should do that or better, I do remember those chips can get quite hot though!
so any recomendations for a fairly decent motherboard with onboard graphics would be great

budget for the motherboard is around £50
Well I've given you two links above, I'm not sure of any Intel® LGA775 IGP boards that sell with the overclocking options you need within your budget! it may be that Gigabyte have something but I'm not familiar with their product range, you would need to search their website and download a few .pdf manuals to see the overclocking options featured in the BIOS . . .
It may be possible to buy a
used Intel® LGA775 *non* IGP motherboard and a
used simple PCI-E GPU for £50 if your a keen bargain hunter . . .
AMD® Tangent!
If I had my way I would get you to sell that processor and anything else from the old computer and build a new AMD IGP system which can be done suprisingly cheap, you have no idea! . . . . although that would require more effort on your behalf!

. . . you could even use your old DDR2 memory but would need to blow around
£100 Total for chip and motherboard with every cool feature included not least of which is amazing overclocking options!
If you could sell the Intel Chip and older ACER motherboard for £20/£30/£40 quid and add in your £50 motherboard budget you virtually there!
£58.98 inc
ASUS Product Page