adrian_d wrote:I did notice as well when running small small combination, the chain touches the big chain ring gear, not quite sure why this might be the case.
Thanks all

Most derailers have an angle adjustment screw (Shimano calls it "B-tension adjustment"). This adjusts the tension of the upper ("b") spring of the parallelogram, and thus the height of the jockey pulley. The looser this screw is, the closer the jockey pulley will be to the cluster.
The angle adjustment will need to be set according to the size of the largest rear sprocket. If you change to a cluster with a larger or smaller low-gear sprocket, you will need to re-adjust this setting. You will also need to adjust this if you change the length of your chain.
If the angle adjuster is set too loose,

the jockey pulley will bump into the largest sprocket

when the bicycle is in the lowest gear (large rear, small front). This is the gear you should check the adjustment in. A larger low-gear sprocket may require a different rear derailer, for enough angle adjustment to clear the sprocket. In extreme cases, such as with a Shimano 36-tooth sprocket, a longer angle-adjustment screw may be needed -- some people even install the screw backwards.
Since a derailer shift is caused by forcing the chain to run at an angle, the greater the angle, the sooner it will shift. The closer the jockey pulley is to the cluster, the sharper the angle will be for a given amount of sideways motion of the derailer. Thus, the looser the angle adjuster screw is, the better the shifting will be.
Thats from Sheldon.
Is that what you were referring to?
http://sheldonbrown.com/derailer-adjustment.html Also:
"Road" vs "Mountain" Rear Derailers
Similarly, derailers come in long-, medium- and short-cage versions. Shimano designates them: SGS (long), GS (medium), and SS (short.) The short cage ("road") ones only work with narrow range ("road") cassettes, because they don't have enough capacity to take up chain slack for use with a wide-range cassette. Short- and medium- cage derailers are also limited in terms of the largest rear sprocket that they can clear without having the

jockey pulley rub on the sprocket

. Generally, SS & GS rear derailers won't work properly with rear sprockets larger than 30 teeth.
Long-cage (SGS) derailers have greater takeup capacity, and work with all types of cassettes. Long-cage derailers are commonly called "mountain" derailers currently, though in the past, this style of derailer was known as a "touring" derailer. (The marketeers retired the use of "touring" as a buzzword in the late '80s when mountain bikes became the hot item.)
http://sheldonbrown.com/speeds.html#derailers