What kind of lab experience do you have? If you haven't done any long undergrad projects then I'd go for a masters first. Make sure it's a research masters. I think the experience is very valuable and will make your life easier.
For the benefit of anyone not familiar with the English system, PhDs are short, money usually runs out after 3 years, so the more comfortable you are in the lab to start with the better.
As far as pay goes, it is possible to get some funding for master's courses. It's usually not a huge amount, but softens the blow anyway.
For PhDs, the current EPSRC rate (£12600 pa, fees paid, no tax) is enough to keep you ticking over comfortably, and you get slightly more if you're in London. If you get an industrial sponsorship it could be more... I've heard of £18K sponsorships for PhDs, which is nuts.
A master's project will give you an accurate taste of what a PhD is like in that group, and will give you the general idea of what PhDs are lke on the whole. What life is like depends on the group and the supervisor. The 4th year of my undergrad was spent in lab doing a 9 month project (it was a masters degree overall) during which I decided to stay in the same group for a PhD because I enjoyed it so much.
In my case, I wouldn't say there's a massive difference in working hours and freedom between the two positions. I don't really work longer hours in the lab, but there is more reading to be done and I do a bit of teaching on the side so it's a busier life.
It's hard to give you firm advice because the working environment in different groups can vary dramatically. If you don't have much lab experience I'd do a masters first and make sure you actually like full time lab work. This will also give you another qualification - with a 2:1 and a masters I expect you'll comfortably get into most places if you decide to go for a PhD.
The bottom line is this: before you apply for a PhD you must meet the supervisor and have a chat with their group to get a feel for what you're getting into.
i guess i was really asking how favorable this would look compared to a phd in employment terms the advantage being you get to choose the direction more.
If you're set on doing one or the other to boost employment prospects, the PhD is definately the higher qualification. The PhD "looks better" but it does mean any company who hires you will have to pay you more, which, on the flipside, can make it harder to find a job (or so I've heard from friends in industry) because positions are more competitive.