I have just installed puppy linux and the bash package but cant seem to have the terminal start up with bash instead of sh
You should be able to change your login shell in /etc/passwd in all Linux distros. Below, an example line. Note how the last component points to a shell binary.
If you want it to be the system-wide default shell, this series of commands (run from a root shell) will do it:
rm -f /bin/sh; ln -s bash /bin/sh
Otherwise, editing the /etc/passwd file as @mkaito suggests will let you change the default shell for your user account.