Daz, the handlebar stem can be a real pain. I'd recommend spraying with wd40 or something similar, then re-assemble everything and start again.
Make sure you loosen off the stem bolt and strike it with a hammer before fully undoing it and removing it.
With the handlebars still attached, but with all the wires & brake cables disconnected, get someone to hold the front wheel whilst you waggle the handlebars from side to side. It is easier to loosen the stem off this way. Once its freed off, you should then be able to pull the stem up by the handlebars.
No guarantee of this method working in all cases, but it works for me
Hate to say it, but sometimes they do just rust solid and there's very little you can do
I've destroyed one chassis by getting too aggressive with the hammer, and also melted a shell by using a blowtorch