I've done a little more investigation and my explanation earlier was pretty much spot on.
With IMAP, when you send an email, your client uploads a copy of the email to the server in the folder you specify - e.g. "Sent items". However, this is NOT the actual sent items folder on Gmail platforms.
IMAP folders work as an overlay on the GMail platform, as it doesn't actually use "Folders" but "Labels" instead. There are actually "System" folders - "Sent Mail", "Drafts", etc. but these need to be accessed differently. If you set your client to just save sent messages in "Sent Items" Gmail will put those messages in the Inbox with the label "IMAP/Sent Items" on it.
You have to set your client to save messages into the actual "Sent Mail" system folder instead, accessed under the [Gmail] subtree:
In short: as the GMail platform remaps IMAP folders to labels, putting a message into any folder other than those under the [Gmail] tree will cause it to end up in the Inbox with the folder name as a label instead.
Mind you if you read Google's instructions on recommended settings they say you shouldn't set your client to save sent messages to the server as it's done automatically by the SMTP server (as I mentioned earlier) but YMMV for Virgin Mail:
http://mail.google.com/support/bin/a...y?answer=78892