Hi Layer3rules,
Finally got it working using the TAP interface instead of the TUN interface (something to do with avahi refusing to leave a local network) also I am not sure if this is needed but I enabled the point to point option (read more about it at http://avahi.org/wiki/Avah4users its point 9 )
Unfortunatly buffering takes ages (20secs of buffering for 3secs of playtime) and I have to abandon it