I figured it out. The docs were a bit unclear (at least to me) on the jboss.xml file. I thought this was an application level configuration, but it is really an ejb-jar level configuration. My bad...
I am facing the same problem. Will you please tell me what did you find out that was wrong.
define your security domain in the jboss.xml like
Thanks for your help. It is working now. Many thanks.