Have a Mk1 Ambiante and replaced the rear drums and hubs with those off a mk4 Golf, including new braded lines. 

Having done so the system was then bled and has NO air in it.

The pedal feel so much better than it did with the dilapidated drums but once ignition is on (and it has the servo assist) the first half of the distance applying the brake has no resistance and goes nearly to the floor to stop.

 

Has anyone encountered similar or knows what this might be caused by? 

@Robchard - How did you bleed the brakes?

Welcome.  

You say with the ignition on and servo assist.

 

?

Do you mean with the ignition on and engine started and running and servo assist, not just the ignition on?

I realise now that the octavia is different in its design to every other car I've worked on in that there are bled screws on the master cylinder, so while the ones on the brakes had no air left these ones had a lot of air.

Having bled the cylinder the car is fantastic now.