Sadly I deleted the game folder and ran verify game integrity from steam just in case it didn't scan certain files which could have been corrupt. Anyway this didn't work, but I have linked the connection issue to single player, if you try to join a server and get the error unable to authenticate and then decide to start a single player game the world doesn't load/create. If you exit the game and start it over then go to single player the world will load/create as normal, so this problem not been able to play single player is only if you try to join a server and get the error and then try to create/load a world in single player.
It took around 45 minutes before I was able to join a server again. The losing connection seems most think its to do with chopping down trees and crafting things, I don't, i think its to do with survival mode its self because you can just be standing there idle and still loose connection, in a period of 4 hours I must have lost my connection at least 12 times.
It would be interesting to know if an errorlog is created when you was first on a multiplayer server and then tried to play singleplayer. If not, please enable debug console and provide the log again if possible.
Is there a specific server you are playing on in multiplayer?