I finally managed to get the USB expander idea to work. I tried to solder directly to the circuit board but failed to get it to work correctly... it would work fine until I wanted to put the cover around the board to tidy up and would always knacker something up, then it wouldn't work!
So I thought I'd just solder at the wires, each side of the expander. As you can see by the images the wires are located on the floor close to the wall and not conveniently at a sitting desk position, so had to lye on my front on a hard floor.

It works though, so I can now benefit from having no wires from my Playstation 3 to the PS3 Eye under the TV. I've used it a number of times and had no problems
Thanks heero_yuy for your help.