Did you intend to include a link to a photo there?

I don't like the sound of a wire going into the house at eaves level, given you previously said there is a wire down the outside of the house from there. That would suggest a bridge tap, (extensions wired off before the master), which is not good for ADSLx and a disaster for FTTC.

Are you sure it doesn't go to a junction box near the hook, which is where the down wire starts?

If it does go inside the house then make sure you point it out to the engineer. It will help with the request for a new entry point on the first floor .

Does the wiring enter the property before coming back out?

The wire enters the property at on the top floor and goes into a BT80 box. It then goes into the floorboards and reappears outside going down the external wall before coming back in again on the ground floor where the master socket was.

Only one extension was used which is near the BT80 box on the top floor.

Wow, well done for reporting the issue to Virgin, much of this kind of stuff goes unreported and that obscures the issue.

Some pictures or a diagram of what's what might help ... but if the dropwire is on the eaves above the external wall where the NTE is to go, then the job is simple enough. Joint at the eaves, and a lead in down to where required.

Bad news there! That is almost certainly star wiring and needs sorting out.

It doesn't matter how many extensions are used, it is the number that exist that mattered. Also, star wired or not, unless a modern filtered faceplate is fitted to the master socket the presence of a ring-bell wire at the master can cost up to 2Mbps on ADSLx and a lot more on FTTC.

Also all kit on an extension also must be filtered if the master socket doesn't have such a faceplate. Remember as well that any plug-in extension cable is very likely to cause DSL noise trouble.