I also live in London and have just started commuting about 2 months ago. It has completely changed my commuting life and I really cannot comprehend why I suffered for so long on the tube. I needed a folder too because my flat was too small for a full size bike. After much thought I ended up buying the Dahon Mu XL. I think it is the perfect commuter bike for London. The 8 speed internal hub gears mean that it is low maintenance (which I hate doing) and the bike comes with a rack and front and rear lights (although the dynamo hub only supplies the front light) as standard. UK prices are expensive but I ended ordering mine from Germany at substantially reduced prices. At the moment I'm doing about 9km each way to and from work but for two days a week I do a total of 35km per day (I visit a climbing wall after work on those days) and the MU can easily handle this. Other than the lycra-clad crowd on racers I seem to pass most people on my MU on the daily commute so it is a good performer.

I think for your circumstances the Dahons are a good choice. Check prices from some German dealers (there are some reputable ones on ebay) as they are substantially cheaper for some models.