Barry, excellent advice which (as per usual) I will be re-reading and taking to heart. To clarify; the lug is not a bit dangerous or aggressive. I say stubborn and you're right, it is very open to interpretation. What I mean is, testing. He wants to see how much I mean it when I ask for something and if I am willing to back up a request with a demand. He is getting to the point where it is quite clear to him I am not only willing but able and so he tests less and less.
I think another problem we were having was a lack of trust which is completely understandable as I have had him less than two months during which he has undergone two stable changes and a visit to the vet hospital. He is now in what will be his home for at least the next 3 years and we have settled into a routine which I try to make comforting without being so repetative that it is a bore (the collecting and grooming, turning out, feeding portions of each day are the same, what we do while we ride or do ground work is where I mix things up for him). Yesterday he spooked twice in the arena when an attack chicken appeared as if from no where. I calmed him and he relaxed visibly. At the end of the ride he was stuck to me like glue and I think he was actually looking to me for comfort. I definitely can feel trust slowly forming between us.
I have gotten some fabulous coaching and discovered my main problem was allowing my emotional attachment and desire to have a special relationship with my horse get in the way of my knowledge on how to handle horses. Ironically, allowing him to get away with things I'd never accept from another horse got in the way of our relationship. Now that I'm back on track things are progressing very well and he is opening up to me and actually getting excited to learn new things.
Indeed I do not live in the city but have no plans to take him into the wide world just yet. My boy is very well schooled indeed but like your horses, he knows instantly if the rider on his back knows what they are doing or not. He is an utter lamb under saddle in the arena (both indoor and out) but he is not the only one still lacking in the trust department. Until I know I can trust him not to be an idiot and trust myself to stay seated and control him if we have a wreck, it will sadly be arena work only for us. Except on the ground. I take him for walks in the wide world as well as lunging and other exercises in the wheat fields out here. As I said, try to mix things up as often as I can. And feel certain I can manage him to this extent.
Thanks again for your advice, which is always worth reading (several times in fact!!)