Citroen Dispatch ignition barrel change. Not starting.

[J1mpy52]

Hi all. I am a newbie oldie, so please be gentle.
I recently swapped a cheap car for a 2004 Dispatch 815 Enterprise 1.9d. I acquired it knowing it had a broken key in the ignition.
The guy was honest with me about the broken key, but needed a car asap, so as I hardly ever used the car I thought it a fair exchange. Not many vans about with a ticket, no advisories and no DTC's showing on the code reader.
The van was running fine when he brought it to me and fine when I drove it around to the rear of my house.
He had been poking his spare key in the end of the ignition, it only went in about a quarter of an inch, but started the van every time. The key fob with the broken blade was nowhere near the ignition when it was started.
The key fob push button is well worn and only unlocks the central locking when pressed; it does not lock it off the button.
My brilliant idea was to remove the steering lock/ignition barrel and try to get the key out.

Try as I might with lock picks it would not. It was very manky in there with obvious rust.
So I ordered a new barrel....Valeo 252402 with two no keys.
All connection were exactly the same, so in she went.
I am sure you know the next bit.......yes, it won't start off those new keys. Shower, the keys do operate the central locking strangely enough by locking and unlocking the drivers door.
I butchered one of the new keys and fitted it into the old fob, where I assume the transponder is and put a new battery in the fob. Fully charged the battery, turned the key, dash lights up, engine turns over, will not fire.
When the key is in the ignition in the off position the alarm light is flashing, but when I turn the key to either position 1, 2 or crank it goes out.
Sorry for the rambling story, but can anyone help?
Best wishes, Jim

[wheeler]

Can you take a picture of the 'Butchering' you have done so we can see what you have.
The chip inside the non remote key will look like this pic below.

[J1mpy52]

Thanks for your reply and sorry for my delayed response.
I have decided to enlist the help of an auto locksmith.
Best wishes,. Jim