What I would like to know is peoples experiences of working as a freelancer in France? What would be the demand for my language pairings which would be French, German and Dutch into English?
High demand - in France and elsewhere. Take a look at the jobs posted on ProZ in these language pairs, keeping in mind that only a fraction of translation assignments are posted directly in ProZ.com's job section.
How is the official bureaucracy what with taxes and the such like - do you need to be registered for VAT? Is there much point in setting yourself up as a not-for-profit "association"?
Take a look at this useful article: http://www.proz.com/translation-articles/articles/77/1/How-to-Become-a-Freelance-Translator-in-France , and browse the French forum. If you have specific questions, the latter is the best place to get an answer.
As for VAT: you do not need to register in the beginning. See more details in natalia's article.
Non-profit association: that would be an option if you offered pro bono translations only. If you want to earn a living from translation, you will have to choose another form.