Being the kind of developer who needs to know how stuff works I tend to RTFM to work out why things like this are happening (here is the slightly painful to read entry from the DirectX SDK). The "problem" it seems is all down to choice of coordinate system.
RtR uses Microsoft DirectX to render its 3-D world. By default Microsoft has chosen the left-handed coordinate system with a vertical y-axis.
The model is now correctly orientated. The reason it's black is because I didn't translate the mesh for the light source and the model is effectively being lit from the underside.
As I've never done any 3-D modelling I don't know how this all works when saving/exporting your work to the .x file format. I have seen many posts concerning which modelling software creates .x files that are compatible with RtR and re-orientating your model before saving so that it ends the right-way-up when loaded into RtR.
More 3-D findings to follow allow with an interesting discovery I have made concerning the usr.xli file...