Thanks for the replies everyone.
So once the Autogrow kicked and timed-out, would this connection not be released by SQL and all the other blocked connections then successfully processed - or does it start looping until successful?
Also, when the DB performs an normal autogrow (successfully), is this logged in the ErrorLog file or stored in a system table somehwere? I need to know if a successful autogrow has occured since setting it to 2%.
As per the advice, I will in future use a set MB amount based on average increase in database size.