Workflow cannot create a browser-enabled InfoPath form

What I have:

• A Form Library - FormsLib.
  This contains customised template, published from InfoPath.
  The template was browser enabled during the publish process
  FormsLib is also browser enabled
  When I click "new" in FormsLib, a new, blank form opens in a browser.
  If I click on a form that already resides in the library, the form will open in a browser.
  This all works fine.

• A List - NewList.
  When I click "new" in the list, there is only one field to fill, Title.

• A Custom Workflow - CreateForm
  Developed in SharePoint Designer. 
  CreateForm is initiated by the creation of a new item in NewList.
  CreateForm then automatically creates a form in Form Library
  

What Should Happen:

1. When a new item is created in the NewList, I am promted to give the new item a Title.
2. I do this and I am brought back to the list where I can see the new item
3. A new form is created in FormsLib
4. When I go to FormsLib and I click on the form, it opens in a browser.

What Happens:

• Steps 1 - 3 above are fine, but when I click on the newly created form in FormsLib, I am prompted to download the form, i.e. it is not browser enabled.
• If I compare this workflow-created form to another form that was created manually in FormsLib, I notice that they both have different file extensions in their URLs. The file that was created manually and opens in a browser has the extension - xml, whilst the other form has the extension - xsn.

Any Ideas ?