Rewrite taxonomy_term_reference urls to read /taxonomy/term/(name)
You should be able to set URL aliases for your taxonomy terms using the Path module that comes with Drupal core. (EDIT: As mentioned by jordojuice, you'll also need the Pathauto module to automatically generate these patterns in the manner I instruct below).


Go to the Configuration menu and select "Url Aliases" in the "Search and Metadata" section. (admin/config/search/path)
In the upper tab of the URL Aliases menu, select "Patterns." Here you can set the path to your taxonomy terms to whatever you'd like.


The only problem is that I don't think Views overwrites the URLs generated. There was a module for this in Drupal 6, but I don't think there is anything similar for D7.

There is a View that comes default in Views that should overwrite the default taxonomy paths; you could see what it does and try to tweak it.