First my setup,
L2 cache: Coherence 3.7
Nodes in cluster: 2
Within coherence config files , cluster name for the same and the caching service is also the same. Actually the config files are the same.
Both nodes running on the same machine.
Within hibernate.cfg.xml
<property name="cache.use_second_level_cache">true</property>
<property name="cache.provider_class">com.tangosol.coherence.hibernate.CoherenceCacheProvider</property>
<property name="hibernate.cache.region_prefix"></property>
<!-- Disable the query cache -->
<property name="cache.use_query_cache">false</property>
<property name="hibernate.show_sql">false</property>

<!-- statistics -->
<property name="generate_statistics">true</property>

The sequence of the running the apps is as follows
Node1: Begin
Node2: Begin and perform transactions that should be cached
Node2: Stop
Node2: Begin and perform the same transactions
Node2: Stop
Node1: Show stats

The stats are as follows for most of the regions
SecondLevelCacheStatistics[hitCount=0,missCount=0,putCount=0,elementCountInMemory=22,elementCountOnDisk=-1,sizeInMemory=-1]

And the logs during the second run, clearly show the hits, misses and puts, but these are not reflected in the stats.
[2011-08-12T12:22:20.424+05:30] [hibernate] [TRACE:32] [] [org.hibernate.cache.ReadWriteCache] [tid: main] [ecid: 0000J6wkkgy1ZbOLMip2ie1EHCqK000000,0] [SRC_CLASS: org.hibernate.cache.ReadWriteCache] [SRC_METHOD: get] Cache lookup:
[2011-08-12T12:22:20.424+05:30] [hibernate] [TRACE:32] [] [org.hibernate.cache.ReadWriteCache] [tid: main] [ecid: 0000J6wkkgy1ZbOLMip2ie1EHCqK000000,0] [SRC_CLASS: org.hibernate.cache.ReadWriteCache] [SRC_METHOD: get] Cache miss:
[2011-08-12T12:22:20.427+05:30] [hibernate] [TRACE:32] [] [org.hibernate.cache.ReadWriteCache] [tid: main] [ecid: 0000J6wkkgy1ZbOLMip2ie1EHCqK000000,0] [SRC_CLASS: org.hibernate.cache.ReadWriteCache] [SRC_METHOD: put] Caching:
[2011-08-12T12:22:20.496+05:30] [hibernate] [TRACE:32] [] [org.hibernate.cache.ReadWriteCache] [tid: main] [ecid: 0000J6wkkgy1ZbOLMip2ie1EHCqK000000,0] [SRC_CLASS: org.hibernate.cache.ReadWriteCache] [SRC_METHOD: get] Cache lookup:
[2011-08-12T12:22:20.497+05:30] [hibernate] [TRACE:32] [] [org.hibernate.cache.ReadWriteCache] [tid: main] [ecid: 0000J6wkkgy1ZbOLMip2ie1EHCqK000000,0] [SRC_CLASS: org.hibernate.cache.ReadWriteCache] [SRC_METHOD: get] Cache hit:

Most of the forums ask the dev to switch on the generate_stats flag in hibernate. I've done that.
What else am I missing

You forget set "hibernate." prefix for properties. What topology your are using?

Also run cache with default hibernate configurations:
-Dtangosol.coherence.hibernate.cacheconfig=/hibernate-cache-config.xml