teresha - 10:14 am on Aug 2, 2001 (gmt 0)

Thanks Alex but my query was not regarding linking the main domain and sub-domain but rather if external links (from sites not owned or operated by me) to the sub-domain would be counted by search engines as links to the main site and vice versa. The answer seems to be that:
Yes, external links to a sub-domain count towards the link popularity for the domain (ie: site as a whole)
and
No, external links to the main domain do not count towards the link popularity of the sub-domain.