Okay, I solved my problem.
I think perhaps no one tried to help because the answer was too obvious. But for those of you that are struggling with imbedded Web Services in an EJB here's what you have to do.
First of all ignore the article that I suggested in my previous post. For your reference this article is:
http://www.theserverside.com/resources/articles/MonsonHaefel-Column2/article.html (igonore it).
The article deals with EJB 2.1 the final draft of this new standard has not been finished and EJB servers/containers are just working out the details now.
All you have to do is access the Web Service through EJB. But, you need to make sure that you have added the library that includes the stubs and skeletons of your Web Service in the lib directory of the correct deployment area in JBoss. Also keep in mind that the EJB runs in a different Virtual Machine to your client. Thererfor you need a way of catching the exceptions and printing them to the console. I passed a string back the client and printed this string.
That's it, once you have everything in place your set.
If you are doing something similar don't hesitate to ask in this forum.