OK.. problem solved. I overlooked an entry I had set up in /etc/syslog.conf that called local8 for the new software I had installed.
So back at the very beginning when I asked you to verify your package...
rpm -V sysklogd
That would have told you that /etc/syslog.conf was changed.
In the future you should be a little more thorough when following the advice of people taking time out of their day trying to debug problems for you remotely. If you don't understand what they are asking you to do, ask.
j