It then assigns the projection as pseudo mercator, which is fine for me viewing it in M9 but this is in red so I need to chose a projection and I have no idea what it is.
DWG format doesn't specify projections, so with any GIS system (Arc, MapInfo, Q, Manifold, etc.) if you want to use a DWG drawing in the correct coordinate system it is you who gets to manually specify what that coordinate system should be. If you don't know, you either have to do some trial and error detective work to help guess the right coordinate system, or you're out of luck.
The good news is that if a DWG shows some sort of geographic setting, like a known island or whatever, it is usually fairly easy by trial and error to zero in on the coordinate system that was used.
Every reasonable GIS has some sort of dialog that is used to assign the initial coordinate system when importing from a non-spatial format that fails to specify what coordinate system should be used.
Here is how to do that in Manifold:
1. Visit the Projections topic.
2. The third heading down, just a few paragraphs into the topic, is "Formats that Do Not Specify Coordinate Systems". That tells you step by step what to do. It's easy, and takes but a moment.
There are also step by step examples specifically for DWG and also for DXF, so it's a good idea to read the DWG topic and the specific DWG example, Example: Import AutoCAD DWG and Georeference , which shows how to work with a well-documented DWG.
For an example of a lucky guess with a poorly-documented DXF (same thing, really, as a DWG... also spatially brain dead...), see the Example: Import AutoCAD DXF and Georeference topic.
In addition to the above, the generic topic that discusses how to assign coordinate systems when the format fails to do so, is: Example: Import a Shapefile.