I tried your suggestion Ace and it didnt work.

I then proceeded to jack around with the tool locations... which didnt work either. I then(laugh all you like) got really angry and click a stream of about 4-5 run step over step into on the debugger when it wasnt connected and working. The IDE decided to freeze... I had to end its task after about 2 min of looking around on the web trying to find some other threads of people with similar issues. On a hunch I restarted my computer again and when the ICD2 connected, it had to DL a new operating system. This is quite common always does this when going from programming 12F's to 18F's. After downloading the operating system it still didnt work. I opened a 12F project and hit program, it didnt DL a new operating system(???). I switched back to a 18F and it DL'd a new one. Then it worked. No ****ing clue as to how or why...

So the good news is I've actually got PBP running and compiling and debug/programing. The bad news is... while PBP does this, C18 only compiles but still wont debug/program. And with that I'll gladly take suggestions however I'll pose the question on another, more appropriate, forum.