[BNaylor]

The indication of conventional braking working OK is correct. When the ABS fault lamp illuminates due to a fault such as a bad wheel sensor only the ABS part is inhibited. This is for safety reasons.

It sounds like the one wheel sensor is bad. When a wheel sensor goes bad it may be normal to get ABS modulation. You can remove the electrical connector at the suspected hub and spray with electrical contact cleaner. With a DMM ohm across the wheel sensor contacts hub side and resistance should read around 1K ohm. DC voltage at the output will measure at least 100 millivolts to 1 volt.