Single template for posts outside of WordPress

I could really do with some help. I have a site that is currently flat HTML with a flat news section, I am turning the site in to PHP and integrating WordPress into just the news section, not the whole site.

Here is my issue:

I have a homepage (outside of Wordpress theme folder),

/index.php http:///index.php

this page has latest articles (posts) on it. I can load these fine by adding "require_once('wp-blog-header.php');" on the page and adding a WP_Query.

I also have a news pages (outside of Wordpress) like so

http:///whats-new/news-articles/index.php /whats-new/news-articles/index.php

Again on this page I am loading recent articles in the same way.

The problem is when clicking on a permalink, to go to the single post view it just defaults back to my home page.

The URL for my permalink on a test post is http:///test-post/ ‎

but it seems to ignore my single.php template that I have placed in the root of my theme folder like so

/wp-content/themes/desktop/single.php

I have tried de-activating and re-activating the theme, incase of caching, I don't know how else to check for this.

Can anyone advise where I am going wrong, I am still fairly new to WordPress.

Best regards

Lee