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Anyone recommend a (DIY) Small office phone system - nothing too complicated only needs to be able to pick up other peoples calls and transfer between phones.

Being able to see who is on the phone/busy is a bonus.

6~8 users hopefully including a cordless.

http://www.ascent.co.nz/productspecification.aspx?ItemID=381152 something like this? But im not sure how the analogue/ idsn lines are converted?

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That is merely an IP phone. You need an IP PBX backend for that to plug into. You can roll it yourself with Asterisk, you simply get analog interface cards to slap into the server you're going to use.
http://store.digium.com/telephony_card_selector.php

It's a fair pain in the arse if you don't know what you're doing though - how much do you value your time? Because once you take into account the back end, and 6 to 8 of those phones, you're soon up at the level where you can just get a vendor in. We just redid our PABX at work the end of last year, $2500 or so on education special for a 4 CO/8 extension system with voicemail. Only two new fancy system phones included in that, and it's only 'VOIP Ready' but yeah.
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Oh and in terms of time, our phones were down for like 3 hours while he wired in the new PABX box and then programmed the system, then it was all over.
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TRIPLE POST

Something to bear in mind about why people shy away from DIY PABX systems - you think users go mad when the computers don't work properly/aren't reliable? You haven't seen ANYTHING till you see users dealing with a flaky phone system.
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Well someone recommend me a decent vendor as the vendors ive seen so far are taking the piss in the most unbelievable way.

I was looking at a 20 line branch last year but that is now on hold.

50K for a swyx system for 20 lines.

12k for an NEC system but you need to give them all your toll calls for 5 years.

I'm just after a really simple/cheap system for a small branch that has been using normal phones & cell phones till now.
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Our setup was an "Aria 24ipe Basic Digital System" with a voicemail card and 2 digital keyphones. (All other stations use standard phones).

Initial capacity 4 CO lines and 8 extensions, "can be expanded to 8 CO lines or 2 BRI (4 ISDN), 4 CO and 24 extensions".

That was from Absolute Business Telecommunications Ltd.
Murray Peterken, Technical Sales murray@abt.co.nz is the business card I have here.

You wont pay as low as we did I suspect, but worth a chat.

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There's no reason to have your own PABX these days, I think i'm up to 15 Cisco VoIP phones at work, all just connected to a hosted environment over our DSL, works a treat.