At least Banks has replied to you in person as that e-mail certainly looks like it was written by Banks rather than one of his team given the tone of the e-mail. Just try getting Fred Done or Denise Coates to e-mail you in person about a dispute so at least he is prepared to face the music.
He's not quite true when he says he doesn't advertise BOG as it does mention BOG on
http://www.geoff-banks.com/about.asp but then straight after it points you to the current offers page where BOG is now not mentioned so he'll just about get away with it on that front.
His terms and conditions definitely have changed in the last 12 months, even in the last couple of months he has pulled a couple of his promotions so again he isn't correct on that.
The only thing you might get him on is him saying "nobody told you we offer this concession". From what you said your welcome e-mail specifically detailed this offer being available and unless you since received an e-mail saying it isn't available, you might have a case there although they may just be able to get away with saying the offer wasn't listed in their terms and conditions on the website when you registered and claiming an admin error with them not amending their welcome e-mail. I also have the feeling that IBAS would rule with the bookmaker on those grounds as from what you hear they are very much a stickler for what the terms and conditions on the website say and don't generally take anything else into account.
It may still be worth a try at IBAS or maybe try to get SBR to talk Banks round to settle the bet at the SP as a goodwill gesture for the poor service with their welcome e-mail giving wrong information, but by the sounds of his e-mail he doesn't seem to be in the mood for doing that.