The issue that I had was managing the menu’s at the top level of a Sharepoint site (site collection) and one of the sites within that collection.

The top level home page menu contained sites and then within the drop down option the subsites of those sites.

The issue was to hide a particular item from that drop down menu.

Editing the navigation options is the correct location. There are two ways to get to this

which leads to the Site Settings page where you select Navigation from the Look and Feel column

Alternatively just use the shortcut from the Site Actions ->Site Settings menu ->Modify Navigation

Once on this page there is a list of the navigation for the current site collection and you can hide or move items around.

The trick is with the option for Global Navigation

There are two options:

Display the same navigation items as the parent site
or
Display the navigation items below the current site.

The first option leaves the modification control only within the scope of the local site, while the second option adds the Global Navigation to the list for modification and allows for hiding or moving the global menu for this site.

I think, given my current limited Sharepoint knowledge, that this is due to the relationships within a site collection. The sites I am working with are within a single site collection. The top level menu takes up all the sites within it as the first menu level and sub-sites as the second level menu.  The options above are to either accept that the Global (site collection) Menu will display all the site/subsites or to have control passed to the site level and have the Global Navigation modified at site control level.