Just thought I'd post an update. Now have perfectly acceptable shed door, machined by me from 4x2 and 8x2 timber. Took a little longer than expected, but thanks to gregers for suggesting it was possible, all it took was bit of confidence.
One learning was that my Black & Decker 1/4" router was not really up to the task. For a start I could only get router bits to cut the mortices with 1/2" shanks, so I ended up hiring a Hitachi router. Boy what a difference that made! For a start the thing was just so much better made, and the motor (2000W vs 450W) just made all the cutting like a knife through butter. Lesson: next time I need to buy a power tool I'll be looking in the semi-pro category rather than the DIY section. Bit more money but well worth it.
John D: Good point you made there. But given that this is only a shed door I didn;t really want to spend that much on it. In the end the timber cost me £27 and the router hire £14, which compared to the £2-300 I was being quoted seemed a bargain. Had it been my front door then that would have been well worth spending but just for a shed? In the end, I gained quite a bit of understanding why it they would have quoted that - the size of the door is almost irrelevant to the time it takes to make.
But hey, it got me back into trying something myself and gaining some confidence into the bargain. I made a few mistakes along the way, but thats the only way to learn. And next time I need something built that needs a bit more quality then I'll happily stump up for someone else to make it!
Cheers