Ken,
I too had some problems getting hibernate deployed as a service under
JBoss 3.2.1. I also (yesterday) deployed StrutsCX and ran into
similar problems.
The issues always involve libraries and where they are/are not found.
There is a doc called "Using Hibernate with JBoss" (
http://www.hibernate.org/66/html) that includes a list of libs that
are required for hibernate. Make doubly sure these are available.
I think they should be placed in ...server/default/lib, assuming you
are using the default configuration.
I am not sure exactly how JBoss gets its classpath or finds libs.
Anyway, that's a question for another forum.