That is correct. It is the hot water off terminal which connects to the grey wire on the 3 port valve terminal 8 and the satisfied on the cylinder stat terminal 7.
You need a wire to connect number 4 on the nest to number 9 in your wiring centre.
But you shouldn't be using single insulated wires like you have. You should use a short piece of 3 core flex for the live and neutral and a piece of 4 core for the switch wires.
No you would have to change the backplate.
The connections would all be the same except the black wire in termination 2 would go to terminal 3 on the new Hive backplate.
:p
I wasn't sure whether he was swapping the Hive for a Nest or the other way round.
I was going to say that if he was swapping the Hive to a Nest then the link should be between L and 2 not 1.
But then I changed my mind in case he was doing it the other way round.
Has it always done this? If yes then check that there is no link in the terminals marked RT24. If there is then remove it and that should cure the issue.
The black and white wires in the boiler are the wrong way round.
If the cover is fixed on the boiler, then the easiest way to solve your problem is to swap over the red and yellow wires on the Hive receiver.