Greetings. Also from NZ here. The girlfriend came home from work complaining that the heater in her K12 isn't working. I proceeded to tear the dash apart, and try recalibrating all the heaters stepper motors. Still didn't fix it. Proceeded to pull off the lower dash cover to look at the stepper motors, and noticed that one of the linkages was loose and flopping around.
Funnily enough, the EXACT SAME linkage you've taken photos of Vicki. That linkage is attached to the air mixer door (blends hot and cold air to get desired temperature). It's definitely what was causing you problems.
I'm going to attempt to epoxy my girlfriends one in the morning, or give superglue a try. If that fails, it'll be a trip to the wreckers.
Bevan
P.S. on the automatic a/c control unit, to calibrate the steppers:
1. Turn ignition from off to run
2. Quickly push and hold the "off" button on the A/c control unit.
3. Observe all segments of the display should light up.
4. Press the "temp up" button on the unit till you get "30" displayed.
5. Press the defrost button.
6. You should hear the stepper motors wind full one way to their zero point.