Not looked in to the Multi thread for a while, so delayed reply!
The smell may be from the resistor pack that is used to provide the different fan speeds. Its a green lump that is placed in the ducting just before the fan (so incoming air cools the resistors to stop them overheating). They do get pretty warm and if not used on the higher speeds for a while a film of dirt/dust seems to burn off them. (My Panda did the same thing a few weeks back when using the fan on speed 4 for the first time in ages)