I have never tested the latency for MIDI->VSTi-->Onboard audio out before, so wanted to check this. I have only used the WDM for work that required no tracking (recording) at all, but thought this would be good to "stress test."
 
Here is the setup used: 

1. Shifted SONAR to WDM mode (using the 16-bit out on the onboard Realtek)
2. Input via a Roland A-300 PRO
3. VSTi used was Dimension Pro. I used one of Craig's EB-5 bass samples and started the buffer on the extreme low end (1msec) and bumped it up till it played back correctly.

Result 1 - On my machine, the 8msec buffer point was where it suddenly changed to the expected sound (below this was rather distorted).
 
Result 2 - Same test with SI-Bass as the VSTi could be lowered to 6msec buffer.
 
Result 3 - Same test with TTS-1 as the VSTi was also at the 6msec buffer.
 
I just wanted to throw this out as a data point, since I actually do not use this setup for recording, but these latencies fall into the "tolerable" range. I got some funky transport start/stop sounds doing an actual tracking test (6msec on the TTS-1), but the notes were timed correctly (which is more the MIDI controller and its drivers than the audio out).
 
Back to the OP, John's recommendation of TTS-1 should be feasible with what you have now.

I have now reinstalled TTS-1 but I am getting no sound - what do you think might be the problem?
I have tried inserted a soft synth track. Please could you describe what settings I need?

When working with MIDI, a couple things to bear in mind:

1. MIDI is only note data, so generates no audio.
2. For a MIDI track to "sound" it must play though a VSTi (or "soft synth").
3. If a VSTi is inserted, the input can be set to Omni (beware, as this means it will accept ALL MIDI inputs if "echoed"). There are many options to insert a soft synth, a "Simple Instrument Track"  takes MIDI (note) data in and generates audio out... this may be the simplest to start with.
4. The output should be set to the Master buss (is default).

 
In your case, verify the input on the TTS-1 is either set to "Omni" or the instrument channel of you specified that input, and "echo" that track.
 
The TTS-1 is actually capable of playing 16 MIDI channels; but for first time use, this should help.
 
 

With most of my old Laptops and NetBooks I installed ASIO4ALL which fixed all sounddriver issues. Dimesnion and Rapture are great soft synths that come with SONAR, also try the cakewalk sound center. I found that Z3TA+2 took up all my resources so be carefull what really advanced VST's you use. So you have and external recrder that is great I assume you have headphones for this venture??? :) The internal soundcard should do anything you want it too ASIO4ALL should work if MME32bit hasn't fixed your driver issues! Be prepared to "FREEZE" your tracks if you run out of CPU Power. I did all my NetBook stuff on an ACER ONE at 1200mhz...yours may be newer and more powerful! GOOD LUCK! -Shawn Lee Farrell
 
 

so when using a soft synth like tts-1 should i see anything in preferences /midi/devices?
I can 't see anything there at the moment
I have connected a M-Audio keystation midi and it is recording midi (and that does show in preferences/midi /devices) but i'm getting no output. Do I also need to connect an external mixer maybe to get output? I have also got an M-Audio mixer. I thought i'd just hear it via the netbook soundcard.
 
 

On the track you're recording the keystation on, what is it's output set to?
It should be something like Microsoft GS Wavetable synth or a software synth that you inserted.
If you inserted a soft synth, what is the synth track's output set to? It should be your sound card or audio interface.
If the output is the keystation, you won't hear anything being that the KS is a controller and has no synthesizer in it.
 

I think you missing the one important step and that's all midi tracks   need to output to either a external device or a inserted VST soft synth. Check the output box of your track and set it to the TTs-1