Found it. It was the dive height (H2.5) in M558, config.sys
M558 P1 H2.5 A2 R0.5 S0.02 F140 T8000 ; Set Z probe type to IR sensor, dive height........
This wasn't big enough. Strange however, previously, in 2.03 this was not a problem, even as the trigger height is 2.77 mm. Increased the value to 3.5 mm and now it works as it should.