I finally traced the problem down.

Im ashamed to post this, but it was just the ICSP cable still connected to my U2 programmer. Usually I leave it connected when programming with pics. On the 16F877, the PGD and PGC pins on the 16F877 are located on PORTB (B7 & B6). As soon as the cable is removed, "boom goes the dynamite." Ive never had a problem like that before, but I also never tried using a keypad with the 16F877.

Thanks again everyone for all the help, it was greatly appreciated. Sorry I wasted everyones time.

Lesson learned, RTFM.

Also is there anything I can do to allow the ICSP adapter to be connected and still be able to have the keypad on PORTB. Or is it just good practice to remove the cable after programming the PIC?