I have just purchased a Nexus 7 (2013) and it auto updated to android to 4.3 as I was setting up.
Unfortunately USB OTG now does not run. I purchased the Nexus 7 for it's OTG feature.
I've done a factory reset but it still loads 4.3
Is there any way I can go back to 4.2.2 - which does support OTG on the Nexus 7
If you are reverting to 4.2 only for USB OTG feature, then I would suggest you not.
I am using a rooted Nexus 7 (2012) from v4.1 - v4.3 and could say from that experience that it has to be rooted for the OTG features to run. Since that's missing from your question I assume that you are not rooted when you had 4.3.
The apps Stickmount and USB OTG Helper needs root privilege to run successfully.
You're going to have to revert by installing a custom recovery, and then flashing whichever ROM you require yourself. It's not difficult but needs to be handled very carefully (ie getting the correct rom, and following all the steps exactly) to avoid damaging your device. You may find it hard to claim repairs under warranty if you do this, depending on the laws where you live.
I don't think the Nexus 7 (2013) ever had Android 4.2. I was going to suggest flashing a factory image but the only one available is Android 4.3 which suggests it's not possible.
As the other answers have suggested you will probably need to root to get the USB OTG functionality you are after.
I have a rooted GNex with stock kernel and stock ROM. Device is only rooted, CWM installed and unlocked bootloader.
I received the OTA update yesterday but haven't tried to apply it since I have a custom recovery installed. You should also know that I removed a file called recovery-from-boot.p to avoid the stock recovery from getting reflashed following the indications in this thread http://www.droidforums.net/forum/galaxy-nexus-development/189062-using-rom-manager-only-way-boot-into-clockwork-mod-recovery.html
I'd like to apply the OTA without losing my data and possibly not root. Losing root is not such a big problem but if you know a way of installing the 4.3 update from CWM without losing data then I'd be so thankful!
You shouldn't lose any data by flashing the OTA file. You can flash the ota file (see AndroidPolice for info and where to download it from) and as long as you've not changed any system files it should apply ok. Simply select the "apply update from sdcard" option and select the update file. You will lose root but you can simply flash SuperSu (the only superuser app that works on 4.3 at the moment) which will "re-root" your device. If you get a prompt about disabling recovery flash, select "No" as the new SuperSu uses this part of getting root access.