A colleague of mine was studying at the University of Vienna and saw an application which was based on linux whereby other pc's booted from it and if on the server they had set it to force a clean install on that PC it would download and install a windows image. Does anyone know of the app or could point me in the direction of a similar app.

Sorry, I have problems understanding what you really want to achieve. If you simply want to install Windows over the network (deployed from a Linux server) you should have a look at this and this for Windows Vista/7, I have already used those HowTos and they work fine. For older versions of Windows this guide worked for me.

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This is sort of what I was looking for but I was hoping to have a Ghost image of a PC at a point with some software installed and was hoping to be able to put it back to the state before any changes were done to it. The pc's are going to be used for configuration of equipment and will need applications loading and updating but one of these could cause it to stop working so the idea was to be able to take it back to a point when I know it did work.

That would be rather simple to achieve:
1. At first make your image and clone it, using clonezilla, dd or some similar tool.
2. Create a mini-Linux that is able to boot from network and contains the tools you need to achieve this task. Actually you would need your imaging tool and tools to mount a network share. Slitaz Linux is perfect for this purpose, because it is very customizable and can boot from network, because it just contains of a kernel and an initrd. Set it up so that it automatically mounts the network share with the image and write the image to the first available harddrive.
3. Set up a server that delivers PXE and network functionality.
4. To install your image, just boot the mini-Linux from the network.

Should be not more than one or two days's work. But there may also be similar pre-built solutions already out there.

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Also there is the intention for the re-image/reinstall only to happen if required. So there should be a user interface which allows you to tell the server that the next time ip(x) starts up it needs to be re-installed.

Should also be simple. Setup the boot-order in the BIOS to something like this:
1. Harddisk.
2. Network boot.

If you want the client to get a new image the next time it boots, just zero out the bootsector of the harddisk, and next time it will automatically boot from network.