Thanks for all your replies, I didn't get to reply earlier because I took both children down the country to visit their grandparents so I could decide what to do and get a bit of extra help.
In answer to the questions, yes they did warn us that she was biting but in that month she got 6 new teeth - two near the front and four back ones. At the review when all the parents go up to see how their kids are getting one they told us there were no problems and that the biting had stopped. This new episode of biting has only happened since the new baby arrived and doesn't happen at home at all. And she was bitten by other children a few times before she ever bit and we didn't complain to the creche - just said kids will be kids.
I forgot to mention that she was only there part-time (although this cost us the same as our mortgage monthly) and I have been wondering whether this might have something to do with it, when she started the creche was only new and had very few children and now it seems very full. To be honest I am happy to have her at home now and it means I won't be going back to work, the decision has been made for me. Although I thought she was happy enough there perhaps she wasn't really and this will all be for the best. But I will be following up on the deposit and a complaint about staffing levels. Will keep you posted on how I get on.