Thanks everybody for the responses.
First, I attach the photo, now compressed, hope it won't be rejected for size. Note this was taken after my repair.
The 'switch pad clearance' is the spacing between the two inner tracks. The main hot input terminal is connected to the outer of the two through the protection network. The moving contact connects it to the inner track, for each of three switch positions: Ohms, Diode, and Capacitance. This switch remains open in all other positions. The inner pad/s of this switch connect through (at least) one very small pth via, visible close to the central guide hole. Since intertrack clearances beyond this point are very small indeed, less than 0.25mm, I conclude that potentials here are at most a few volts.
Note that ANOTHER identical protection network is present, connected to the hot input again. This feeds the voltage measurement circuit, switched on the outer tracks and offering much larger an intertrack clearance. As much as 3mm. The shorting contact for this is also different, at twice the pitch. It is clear that the designer is entirely aware of the need to space tracks wider apart, but fails to implement this in the Ohms circuit even though the voltage to be stood off is the same 1000V.
The protection network in each case has a 1k, 1 possibly 2W series resistor; it's speciality if any is unknown, but I presume it is a special 'fusible' resistor a la Fluke. Its thermal capacity is still far too high in my opinion to limit the energy let through into the inner measuring circuit, unless this latter can clamp its voltage to under a few volts, limiting the power, while the protection resistor passes up to 250mA before opening up.
The two spark gap 'diodes' cannot and should not have a role to play for impressed voltages of up to 1000V rms, more if the permitted crest factor is taken into account. The PTC thermistors would act to curtail the fault current, but they too have large heat capacity and would need time.
All these protection components are soldered in place, unlike the two big fuses for the current measurement circuits. Operation of any one or more soldered component would render the instrument unusable, or in any case require factory service. Thus, the unit can not be said to 'withstand 1000V rms', even if the Cat III certificate would appear to say so.
I have explained all these points threadbare to Keysight's 'site assistance'. To summarize their answers:
1. Never happened before, unique case in our data bank; unfortunate
2. The U1241B complies entirely with its declared specification and is certified to CATIII
3. Give us the failed unit, we will investigate further
4. All manufacturers made design changes in 2011 to comply with revisions to standards; my unit is earlier. Will replace if I so want
5. All U1241B's will withstand 1000V rms at the hot input terminal with the switch in any of the positions measuring Volts, Ohms or Capacitance.
I have even asked their concurrence for me to test my unit with voltage applied in steps starting at say 300V.
Their replies do not even pretend to a answer the points raised. I can forward the correspondence by private mail if this is useful.