Virtual Box Issue afater upgrade to Natty Narwhal

I upgraded to natty from 10.04 going via 10.10
The 10.10 Upgrade went Ok with a warning re Virtual Box - but it still worked
I proceeded to do the natty upgrade.

However I had problems with Virtual Box ( I use it to run XP for Itunes)

Virtual Box started but the machine would not.

I googled the problem - Advice seemed to be uninstall and reinstall - did that but stall the machine does not start.

The Re-install was the 4.0.8 for Natty - the previous was 4.0.4

Error messages

Result Code:
NS_ERROR_FAILURE (0x80004005)
Component: Machine
Interface: IMachine {662c175e-a69d-40b8-a77a-1d719d0ab062}

Advice was to
sudo /etc/init.d/vboxdrv setup
[sudo] password for mark:
 * Stopping VirtualBox kernel modules [ OK ]
 * Uninstalling old VirtualBox DKMS kernel modules [ OK ]
 * Trying to register the VirtualBox kernel modules using DKMS
Error! Your kernel headers for kernel 2.6.38-10-generic-pae cannot be found at
/lib/modules/2.6.38-10-generic-pae/build or /lib/modules/2.6.38-10-generic-pae/source.

 * Failed, trying without DKMS
 * Recompiling VirtualBox kernel modules
 * Look at /var/log/vbox-install.log to find out what went wrong

/var/log/vbox-install.log is

Uninstalling modules from DKMS
  removing old DKMS module vboxhost version 4.0.8

------------------------------
Deleting module version: 4.0.8
completely from the DKMS tree.
------------------------------
Done.
Attempting to install using DKMS

Creating symlink /var/lib/dkms/vboxhost/4.0.8/source ->
                 /usr/src/vboxhost-4.0.8

DKMS: add Completed.
You can use the --kernelsourcedir option to tell DKMS where it's located, or you
 could install the linux-headers-2.6.38-10-generic-pae package.
Failed to install using DKMS, attempting to install without
Makefile:169: *** Error: unable to find the sources of your current Linux kernel
. Specify KERN_DIR=<directory> and run Make again. Stop.

Any advice welcome
Mark