I will presume you have bled the one in the engine compartment? did the bulkhead bleed have a good flow as these tend to block up with crud, lastly did you have the heater on hot when bleeding.
On the hot/cold vent as a complete and utter guess maybe at tick over (in traffic) the air lock is in a position to allow the heater to work but increased revs/flow moves it to block the flow. This could be tested by repeating what happened if you can't find a jam just let it tick over. If it does happen again it points to an air lock, unless!!!! something I just thought of there is a restrictor in the 4 way connector maybe this was disturbed/lost in the engine work. I know very little about this but I think it affects the heater, I have attached a thread and others are available.
MGF & MG TF Owners Forum - Plastic part in coolant rail - (the-t-bar.com)
On the hot/cold vent as a complete and utter guess maybe at tick over (in traffic) the air lock is in a position to allow the heater to work but increased revs/flow moves it to block the flow. This could be tested by repeating what happened if you can't find a jam just let it tick over. If it does happen again it points to an air lock, unless!!!! something I just thought of there is a restrictor in the 4 way connector maybe this was disturbed/lost in the engine work. I know very little about this but I think it affects the heater, I have attached a thread and others are available.
MGF & MG TF Owners Forum - Plastic part in coolant rail - (the-t-bar.com)