I know this comes a little late, but in order to help all those folks that are googling out for this issue, here are my two cents:
If you use JBoss AS 5.1.0.GA (I'm not sure about the previous versions, but for this one it is for sure), you should check your %JBOSS_HOME%/server/.../conf/bootstrap/profile.xml configuration file. Somewhere around line 100, there should be a line saying
<value>WEB-INF/dev</value>