<p>Whilst investigating a memory leak I discovered that it was caused by calling NewRow() on a Table inside a loop many times. However the DataRow created was never added to the Table Rows collection and the Table Rows Count never got above zero.</p>

<p>My question is why does this use up more memory every time NewRow is called even though the newly created DataRow never gets added to the Rows collection and the DataRow returned from NewRow is always assigned to the same local variable (thereby apparently discarding the last new row).</p>

<p>Please ignore the issue of why the code is creating DataRows that don't get added to the table!</p>

I think your two issues are related.
Table.NewRow creates a new data row that has the same column format as the initial Table.
This new row needs to be added to the table using table.Rows.Add(newRow). Your loop will be creating objects that are never used and hence will eat up memory.
See this article for more information
http://msdn.microsoft.com/en-us/library/system.data.datatable.newrow.aspx