Call rejected because extension not found

Would appreciate some pointers on the following with Asterisk 1.8
I want to allow incoming calls from anyone at IP (eg) 123.123.123.123
I have this in sip.conf

[sipsource]
type=peer
dtmfmode=rfc2833
host=123.123.123.123
context=incoming
insecure=invite,port
canreinvite=no
usereqphone=yes

And this context in extensions.conf
[incoming]
exten => _0[1-9].,1,Dial(SIP/sipdest/${EXTEN})

where sipdest is another peer defined in sip.conf

I consistently get this:
[Feb 11 22:57:59] NOTICE[7465]: chan_sip.c:21355 handle_request_invite: Call from ‘sipsource’ to extension ‘0123456789’ rejected because extension not found in context ‘incoming’.

The peer is being identified from the incoming call because if I change the context name there, it changes in the above NOTICE, but I can make any change to the context pattern and it never matches. I can even remove the context altogether from extenstions.conf and the same NOTICE message is produced.

Have spent all day trawling the forums and am completely stumped.

Its suspect that the dialplan is actually there. Do a dialplan show incoming on the console and see if the output matches what you think it should be.

Hi Mazzic,
diaplan show incoming reveals:

[ Context ‘incoming’ created by ‘pbx_config’ ]
’_0[1-9].’ => 1. Dial(SIP/sipdest/${EXTEN}) [pbx_config]

-= 1 extension (1 priority) in 1 context. =-

This is what’s baffling me. Even if I change the pattern to _X. the context is still not found
Thanks