To fix NAT issues on Nortel Contivity 1600s when the VPN connections disable split tunneling, you will need to add a static route on your internal router.
A recent deployment of a hub and spoke Nortel VPN solution using a 1600 at the core and 100s at the satellites. The clients behind the 100's had difficulties accessing the Internet and the Internal network at the same time through the 1600. Either Internet access was available, or access to the Internal net was available, but not both.
This problem resides on the 1600. The device actually NATs the source IP of ALL TRAFFIC routing through the device. This is a problem if your internal router at the core points out to another default route, and does not use the 1600 as the default gateway. To resolve this issue, add a static route for the external, live IP of the 1600 external interface to your internal router and point that route at the internal interface of the Contivity 1600.