JDBC isolation level is configured at the JBoss datasource/connection pool level.
We will have Hibernate-specific annotations and XML metadata that you can use to do these additional things like "select...for update" and locking.
Do you know what is coming up in the "Isolation Level" section of the draft (2.8.6 in the draft 2). Will there be something possible like SELECT ... FOR UPDATE?
I think this is a essential feature that should be covered somehow by the standard and should not depend on JBoss specific features. Even though it is nice to hear that JBoss will support it anyway :)