Peter, thanks for your manual extract, that is most interesting and I think clarifies the point.
So presumably the route 'AAA LDN ZONE 7-9' merely allows the passenger to return to a different station within said zones (or I suppose start at a different station to the origin on the ticket).
Presumably though, as tickets are intervailable, an LT issued Zones 1-9 Travelcard would be valid for unlimited journeys on BR services to Amersham (as they would be valid for unlimited LUL journeys to Amersham) but only one journey on BR to Bushey. But would it allow unlimited journeys on the outer zones of the DC Lines, which are BR but operated by LT?
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I think I tried the Zone 1 Watford, and it came up no fare available. In the end, I sent them to the booking office in Pad, and made a mental note to look it up - which slipped my mind...
Through tickets to/from the Underground always seem a strange world to me. In some cases, there are only fares from Zone U1256, in some cases there is a cheaper fare for Zone U1* or Zone U12*, but in this case none exist. I would suggest in such cases (I wouldn't be surprised it Watford was unique), either:
issue the ticket from Acton Main Line (a fare does exist, the SDS is £12.40)
issue a ticket from Zone U1* to Watford North (SDS £11.70), although this would only be valid via Euston, as Queens Park is in Zone 2. In any case, the are from Zone U12* is the same, that would allow travel on the Bakerloo to Harrow.
How you are supposed to know all that on the few times you are asked I have no idea.
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According to the LT fares table, there should be a SDS Zone U1*-Watford Jn for £11.30, why that isn't in your machine (or Webtis) I don't know. The Trainline can find it, but strangely also comes up with a £9.00 SDS via Queens Park, I don't know what that is.
http://www.tfl.gov.uk/tickets/14416.aspx