Thanks for the reply. A coworker pointed me to this article (http://community.jboss.org/wiki/ProtectingEJBWebServicesWithXACMLABeginnersTutorial). Not sure how I did not see that. Using the new sample, the service would deploy, but would fail authorization on the 3rd test. (Details about that can be found in comments at the end of the Beginners Tutoriall. I debugged into the code down to the sunxacml.PDP class but the source was not available and that is the class that was making the final authorization decision.
I decided to back up and revert my JBoss installation back to the starting 5.1 state and try the sample. It worked! So either I updated my JBoss 5.1 instance with the latest Picketbox (3.0 FINAL)and XACML (2.0.6) jars incorrectly ( http://community.jboss.org/thread/167152?tstart=0 ) or the example here: (http://community.jboss.org/wiki/ProtectingEJBWebServicesWithXACMLABeginnersTutorial) is not compatible with the newest release. The trace logs can be found in the discussion section of the beginners tutorial.
Any ideas on why the sample might fail with the latest bits?