This diagram...
http://www.diyfaq.org.uk/plumbing/combi.html
shows the paths for hot water and heating - if the diverter valve is in the wrong position (stuck half way) the heat output might be shared between rads & taps even though it should all go to the taps.
I would suspect the diverter valve being defective and causing your problem.
Peccavi, May 2009