<p>How can I customise the Site Actions menu to remove or rename 'standard' menu items? Where are the site actions menu items defined? </p>

The site actions menu is defined in the Siteaction.xml in Template\layouts\editingMenu under the 12 hive.  The following link shows how to manually remove items.
Customize Site Actions Menu
I have added options to the menu using features, but have never tried to hide OTB option in code.  I would be interested in your results.
Good luck!