Hurrah! I'm not stupid - its just that the rules were unclear!
In MERP, the encumbrance penalty (calculated slightly differently from RM2) clearly applied to MM as well as movement.
I think I will apply the RMC/X encumbrance penalty to MM as well as BMR. Strength bonus can offset the penalty in addition to off-setting quickness mods to movement due to armour.
Okay - I think I have it....
Thanks for the detailed response.