I am stuck on the first boot - can't connect via browser

Yes. First get your raspberry pi working with rasbian, then install hass.io etc.

It looks like your machine, for some reason, is trying to boot from a network server.
Some machines default to that if they cannot find a bootable OS.

Ohh but I have just changed the OTP on my RPI3 to boot from USB howcome it then tries to connect to a server - isnā€™t that strange?

Does your USB drive contain a bootable image? How did you image it?
I assume you have a Pi. I am currently running fro a USB SSD.

I suppose hassio_rpi3-2.12.img is bootable but could it be the HassOS is not USB suitable ?

Is the USB device you are trying to boot from formatted in FAT32. Have you confirmed that the change in OTP has actually taken effect.

No and Yes - OTP is correct that Iā€™m sure about

But the USB img I have just ā€œflashedā€ - hmm could that be the ā€œchicken-in-the-eggā€ - If img is not FAT32 then USB is no-go

Just type

$ vcgencmd otp_dump | grep 17:
17:3020000a

at the cli to check the boot sequence is set correctly but you definitely need your boot device formatted in FAT32.

Yep I saw the same when I changed the OTP on my PI

But now I have tried both flashing hassos_rpi3-2.12.img to my SSD drive and a SD-card in a SD-card reader inserted into my PI (like my SSD was) - but they seem to have the same issue

What about running Hassio on Raspbian Lite? That gives you a real Linux OS underneath. I am running a venv install on Raspbian Lite right now.
I flashed the drive using Etcher. It complained about a 240 GB SD Card, but it worked. I have heard that some USB enclosures do not work for boot. I guess my choice was lucky as well as inexpensive.

Ok your boot sequence is correct so you need to tackle the FAT32 situation. Try the FAT32 formatting on one of those devices, install your chosen image and try again.

Exactly the FAT32 is my issue but like @anon34565116 mention - it would probably be best just to go for the ā€œreal linux OSā€ like Raspbian Lite and if it is not ā€œtooā€ bussy running Hassio it could even be used for something else.

Thereā€™s small issues using a HDD drive relating to spin up times and HA not finding the boot config quick enough.

Iā€™d probably go for an SSD as my first choice and a USB stick as my second but I recommend trying all three.

It must be understood that performance will be determined by transfer speed of the USB 2 port on the Raspberry Pi.

Thanks - I have just ordered a mSATA SSD for my Pi Desk then it should be real SSD and not just SSD-USB connected or is it the same ?

If it is a SATA SSD you need a case to connect it USB to the Pi.
Here is the one I used with my Intel laptop SSD.

https://www.amazon.com/gp/product/B07K72TY63/

Just have a look at this video before you order anything https://m.youtube.com/watch?v=ubnwvxF3Klc

Thanks - that is the video where I got the interest for SSD from and the case that I want a bit more secure setup than sd-card based