Freelander 2 Fumes through air vents

I've moved onwards and upwards and now have my 2007 Freelander 2 - but having a bit of a problem with the climate control. When I turn up the heat from cold there is a really bad smell from the vents and sometimes there are visible fumes. It's almost like burning oil. The fumes only last a short time but recently the windows have fogged/misted up more often. When it happens I tend to turn the heat back down which remarkably enough resolves the fumes issue. I'm no mechanic but what I would hope to do is if I can't fix it myself then at least diagnose it before leaving into the garage to get fixed.
Any help would be much appreciated.

Sounds like heater matrix is leaking

Hard to tell without inspecting it

Cheers td4van,
I'd prefer to be able to atleast point the garage in the right place rather than spending a fortune on their labour costs to find the problem!!
Is your reasoning down to the problem only occurring when the heating is on?

Dee