Well I started typing this as I was trying some different things, so instead of deleting everything I'll go through the process...
If you look in the error_log for httpd it will tell you why it is failing.
I see a bunch of errors like this:
File does not exist: /home/e-smith/files/ibays/Primary/html/blah, blah, blah
Sounds like an issue w/ symlinks? I have wordpress installed in /opt/wordpress and have added symlinks to that location from my primary ibay. I did
db accounts setprop Primary FollowSymLinks enabled
back when I first setup the symlinks. I just did
db accounts setprop Primary AllowOverride All
expand-template /etc/httpd/conf/httpd.conf
/etc/rc.d/rc7.d/S86httpd-e-smith restart
as I had not been using the .htaccess file before.
Then I looked and didn't see a symlink to the .htaccess file so I created it to /home/e-smith/files/ibays/Primary/html/ by using this
ln -s /opt/wordpress/.htaccess /home/e-smith/files/ibays/Primary/html/
and the syslink appeared and the permalinks work. I have no idea why the link to .htaccess wasn't there before... I did this
ln -s /opt/wordpress/* /home/e-smith/files/ibays/Primary/html/
back when I first setup wordpress...
If I understand correctly, several folks here have suggested adding the .htaccess variables to the custom template instead of using .htaccess. I don't know how to do that with /etc/e-smith/templates/etc/httpd/conf/httpd.conf/92wordpress though...
b-t-w I am using the "stock" .htaccess that came w/ the wordpress contrib, with no modifications like I quoted in an early post on this thread. This is the .htaccess that I am using
# BEGIN WordPress
<IfModule mod_rewrite.c>
RewriteEngine On
RewriteBase /
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule . /index.php [L]
</IfModule>
# END WordPress
Thanks Shad

Ryan