But yes - It works like a charm. And the timestamp solution seems to do what its supposed to

Is it also correct that the
if (fanSpeed == 'Auto')
and not:
if (mode == 'Auto')
and so on...?

I am sorry it is a problem of copy/paste I have updated the script.

Is it also correct that the //Update Fan Speed should use
if (fanSpeed == 'Auto')

and not:
if (mode == 'Auto')
and so on...?

Is it possible to create a custom "Multi selector" sensor?

Right now it is impossible in MyController.

Regarding the script itself - would it not need some logic to prevent it from sending the value if nothing has changed?

you can check timestamp or previousValue of a sensor variable.

timestamp >> would be a great one, you can make a condition with reference timestamp, if any one of sensorVariable timestamp changed, you can trigger further operation.
previousValue >> compare value with previousValue, may not be a perfect solution! Might be changed multiple times within few seconds with the same value. Which leads false indication.

I vote for timestamp solution, Here is simple check based on timestamp, For this you have to create new variable on Variable repository to take last execution time as a reference time. Create variable hp-lastcheck on Utilities >> Variables repository, add 0 as Value(default value, to avoid script null failure).

//Get last check from variable repository
var lastCheckVariable = mcApi.variable().get("hp-lastcheck");
var lastCheck = lastCheckVariable.value;

//Get sensor values with UID Tags
var modeSensor =  mcApi.uidTag().getByUid("hp-mode").getResource(); //Heatpump Mode, sensor
var fanSpeedSensor = mcApi.uidTag().getByUid("hp-fs").getResource(); //Heatpump Fan Speed, sensor
var temperatureSensor = mcApi.uidTag().getByUid("hp-temperature").getResource(); //Heatpump Temperature, sensor

// Take refrance of current time, to update last check
var currentTime = Date.now();

if(modeSensor.timestamp >= lastCheck || fanSpeedSensor.timestamp >= lastCheck || temperatureSensor.timestamp >= lastCheck){
  // Update values
  var mode =  modeSensor.getValue(); //Heatpump Mode
  var fanSpeed = fanSpeedSensor.getValue(); //Heatpump Fan Speed
  var temperature = parseInt(temperatureSensor.getValue()).toFixed(0); //Heatpump Temperature

  var modelCmd = '0'; //Default
  var powerModeCmd = "00"; //Default value
  var fanSpeedCmd = "0"; //Default value

  //Update mode
  if (mode == 'off'){
    powerModeCmd = '00';
  }else if (mode == 'Auto'){
    powerModeCmd = '11';
  }else if (mode == 'Heat'){
    powerModeCmd = '12';
  }else if (mode == 'Cool'){
    powerModeCmd = '13';
  }else if (mode == 'Dry'){
    powerModeCmd = '14';
  }else if (mode == 'Fan'){
    powerModeCmd = '15';
  }else if (mode == 'Maint'){
    powerModeCmd = '16';
  }

  //Update Fan speed
  if (fanSpeed == 'Auto'){
    fanSpeedCmd = '0';
  }else if (fanSpeed == 'Fan 1'){
    fanSpeedCmd = '1';
  }else if (fanSpeed == 'Fan 2'){
    fanSpeedCmd = '2';
  }else if (fanSpeed == 'Fan 3'){
    fanSpeedCmd = '3';
  }else if (fanSpeed == 'Fan 4'){
    fanSpeedCmd = '4';
  }else if (fanSpeed == 'Fan 5'){
    fanSpeedCmd = '5';
  }

  var temperatureCmd = parseInt(temperature).toString(16).toUpperCase();
  if(temperatureCmd.length < 2) {
    temperatureCmd = '0' + temperatureCmd;
  }

  var modeCmd = '00'+modelCmd+powerModeCmd+fanSpeedCmd+temperatureCmd;

  // send to your IR
  // Get IR sensor via UID-Tag
  var irSensor = mcApi.uidTag().getByUid("my-ir-sen").getResource();
  // Update value
  irSensor.value = modeCmd;
  // Send value to sensor
  mcApi.sensor().sendPayload(irSensor);
}

//Update lastCheck refrence
lastCheckVariable.value = currentTime;
mcApi.variable().update(lastCheckVariable);

I think I should change from "simple" to "cron" for the timer. However it won't accept my cron entry "*/4 * * * * *" trying to make it run every 15 seconds...

In MyController cron is based on Quartz Scheduler. You should have at least one ? in your cron. Kindly refer this tutorial.
For 15 seconds: 0/15 * * * * ?

Regarding the script itself - would it not need some logic to prevent it from sending the value if nothing has changed?
I added the script on the "Utilities > Scripts tab" - created an "Execute Script" operation on the "Resources > Operations" tab, and finally a simple timer, running every 15 seconds, operating the "operation".

If the script doesn't check for changes and stop if none has happened, I suspect that I will hear a most annoying beep from the heatpump four times every minute
I won't mind, but I'm sure I will shortly be single again....

UPDATE
It works as I feared
Tried just doing "Text" sensors for holding the variables, and the code picks them up (except for fan speed), and sends them to the heatpump faithfully every time the script runs...
Mildly annoying

Also, I think I should change from "simple" to "cron" for the timer. However it won't accept my cron entry "*/4 * * * * *" trying to make it run every 15 seconds...

JavaScript code for the above LUA script,

//Get sensor values with UID Tags
var mode =  mcApi.uidTag().getByUid("hp-mode").getResource().getValue(); //Heatpump Mode
var fanSpeed = mcApi.uidTag().getByUid("hp-fs").getResource().getValue(); //Heatpump Fan Speed
var temperature = parseInt(mcApi.uidTag().getByUid("hp-temperature").getResource().getValue()).toFixed(0); //Heatpump Temperature

var modelCmd = '0'; //Default
var powerModeCmd = "00"; //Default value
var fanSpeedCmd = "0"; //Default value

//Update mode
if (mode == 'off'){
  powerModeCmd = '00';
}else if (mode == 'Auto'){
  powerModeCmd = '11';
}else if (mode == 'Heat'){
  powerModeCmd = '12';
}else if (mode == 'Cool'){
  powerModeCmd = '13';
}else if (mode == 'Dry'){
  powerModeCmd = '14';
}else if (mode == 'Fan'){
  powerModeCmd = '15';
}else if (mode == 'Maint'){
  powerModeCmd = '16';
}

//Update Fan speed
if (fanSpeed == 'Auto'){
  fanSpeedCmd = '0';
}else if (fanSpeed == 'Fan 1'){
  fanSpeedCmd = '1';
}else if (fanSpeed == 'Fan 2'){
  fanSpeedCmd = '2';
}else if (fanSpeed == 'Fan 3'){
  fanSpeedCmd = '3';
}else if (fanSpeed == 'Fan 4'){
  fanSpeedCmd = '4';
}else if (fanSpeed == 'Fan 5'){
  fanSpeedCmd = '5';
}

var temperatureCmd = parseInt(temperature).toString(16).toUpperCase();
if(temperatureCmd.length < 2) {
  temperatureCmd = '0' + temperatureCmd;
}

var modeCmd = '00'+modelCmd+powerModeCmd+fanSpeedCmd+temperatureCmd;

// send to your IR
// Get IR sensor via UID-Tag
var irSensor = mcApi.uidTag().getByUid("my-ir-sen").getResource();
// Update value
irSensor.value = modeCmd;
// Send value to sensor
mcApi.sensor().sendPayload(irSensor);

You have to set UID Tag for each sensor and get sensor value with UID Tag. There is no event mechanism in MC right now. You have to configure a timer job to run this operation.

But - was my above info useful, or was it insufficient to explain the issue?

-- These are the configuration variables, set them according to your system
modelCmd = '0'        -- Panasonic CKP, see https://github.com/mysensors/Arduino/blob/development/libraries/MySensors/examples/HeatpumpIRController/HeatpumpIRController.ino#L68
textDev = 'IR data'   -- Name of the 'IR data' MySensors device
irSendDev = 'IR send' -- Name of the 'IR send' MySensors device


commandArray = {}


for key, value in pairs(devicechanged) do
  if (key == 'Heatpump Mode' or key == 'Heatpump Fan Speed' or key == 'Heatpump Temperature') then

    mode = otherdevices['Heatpump Mode']
    fanSpeed = otherdevices['Heatpump Fan Speed']
    temperature = math.floor(otherdevices_svalues['Heatpump Temperature'])

    if     (mode == 'Off')   then powerModeCmd = '00'
    elseif (mode == 'Auto')  then powerModeCmd = '11'
    elseif (mode == 'Heat')  then powerModeCmd = '12'
    elseif (mode == 'Cool')  then powerModeCmd = '13'
    elseif (mode == 'Dry')   then powerModeCmd = '14'
    elseif (mode == 'Fan')   then powerModeCmd = '15'
    elseif (mode == 'Maint') then powerModeCmd = '16'
    end

    if     (fanSpeed == 'Auto')  then fanSpeedCmd = '0'
    elseif (fanSpeed == 'Fan 1') then fanSpeedCmd = '1'
    elseif (fanSpeed == 'Fan 2') then fanSpeedCmd = '2'
    elseif (fanSpeed == 'Fan 3') then fanSpeedCmd = '3'
    elseif (fanSpeed == 'Fan 4') then fanSpeedCmd = '4'
    elseif (fanSpeed == 'Fan 5') then fanSpeedCmd = '5'
    end

    temperatureCmd = string.format("%02x", temperature)

    modeCmd = '00' .. modelCmd .. powerModeCmd .. fanSpeedCmd .. temperatureCmd

    print(string.format('Mode: %s, fan: %s, temp: %s, modeCmd: %s', mode, fanSpeed, temperature, modeCmd))

    commandArray['UpdateDevice'] = otherdevices_idx[textDev] .. '|0|' .. modeCmd
    commandArray['IR send'] = 'On'

  end
end

return commandArray

The code will generate an eight digit code looking something like this:
12345678
Position 1+2: Always "00", double zero
Position 3: Model code - in my case "4" - refers to Arduino sketch
Position 4+5: Power mode - for example "11" - Auto mode
Position 6: Fan speed - for example "3" - speed 3
Position 7+8: Temperature in hex - for example "18" - 24 degrees

Above would result in the string: 00411318 - Auto mode, Fan speed 3, 24 degrees

The mode, fanSpeed and temperature variables defined in the first section refers to the dummy devices that were needed on Domoticz