You do not need to use Hibernate to connect to the HSQL database. I suggest that you create a another HSQL datasource and use that - you can use the two existing *-ds.xml files (one for DefaultDS, the other for the portal) as examples of how to do this.

Sounds like you need to grab a tutorial or book from somewhere. I know that the book JBoss at Work (http://oreilly.com/catalog/9780596007348/) has an entire chapter on database access in JBoss AS. That book is based on 4.0.2, but the database access is still valid in 4.2.x and 5.0.

Also, perhaps one of the wiki pages on setting up a data source would help you: http://www.jboss.org/community/docs/DOC-12244

And then there are the docs: http://www.jboss.org/file-access/default/members/jbossas/freezone/docs/Server_Configuration_Guide/4/html/Connectors_on_JBoss-Configuring_JDBC_DataSources.html