I came to Oz in Sept 07 with a working holiday visa, which I didn't use, and returned to the UK 10 weeks later. Is it possible to return to Oz on the same visa and work until Sept 2008? Also I will be 31 in May, does this affect my visa too or will it still last 12 months?
Yes, it's possible to return - the visa is "multiple entry" (if you got the sticker, you can double-check that it includes those words), so you can enter Australia as many times as you like up to one year after first entering the country.
Your age only matters for being granted the visa, not afterward. In theory, someone aged 30 years and 364 days could be granted the visa, wait 364 days before entering Australia, and then stay in Australia almost up to his 33rd birthday.
Yes, this will be fine as working holiday visas are multiple entry. Your age should be no problem either, as I believe you just have to be under 30 when you apply for your visa, not when you enter the country.