Sounds like a mechanical gearbox fault with those symptoms - if it was electrical (the F125 switch which is probably what they're trying to suggest) then you wouldn't get any physical slipping of the gearbox. It would just go into limp mode (all DIS gear options lit up red) and still drive more or less fine, albeit only in 3rd gear or reverse!
How long ago did you buy it? Sounds like a very close inspection of the small print of sale of goods act may be required or a visit to CAB and/or trading standards may be required. I suspect your best hope is you return the car and get a partial refund back.
The cost of a replacement gearbox, done properly, will be a significant proportion of the car's value. Depending on mileage of course. If you can't stomach the £1000-1500 cost of a repair, or get your money back, then breaking would probably be the most cost effective option and depends on spec and condition etc what the forum sponsors might offer you for it.
Might be worth a visit to http://www.agc.uk.com/index.html if you're down that neck of the woods to confirm it's mechanical and the potential cost to repair.
Hope you get it sorted
Adrian
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