On Thu, 29 Jun 2006 17:06:54 +0100, Richard M Willis wrote:

She said that if you have a Z2345 travelcard and you travel from SJW to SE
via the Jub/Metro and Rayner's Lane lines, you need to pay for zone 1 even
though you don't use it.

You can avoid paying for Z1 by leaving and re-entering the station at
Rayners Lane. (You have to walk past the gateline when changing trains
there anyway.) This effectively splits your journey into two journeys,
each of which is charged at the Z2-6/Z3-6 rate.

This seems to throw up a contradiction:
a) if you have a Z2345 TC, you don't have to touch in/out so if you go that
route you have a valid ticket all the way.
b) if you have a Z2345 TC and *do* touch in/out, Oyster will charge you
for a zone 1 journey which you don't have on your TC, so will take it out
of your PP balance.

This doesn't seem right to me.

It is right, in the sense that it's correct. (Of course, it's arguably
not right if you mean in the moral sense.)

Can anyone else explain how zones and Oyster PP interact ?

Looks to me like you already have it sussed.