jdmac:
Right now I have it running the blink sketch with the USB cable but if I remove the USB cable and REconnect it the blink sketch will not start.
Can you confirm this is just with the basic Arduino board plugged into a USB cable to the PC - no additional hardware or shields of any sort attached?
The only way I can account for that behaviour is a flash memory failure, but I've never seen that problem mentioned and it seems a bit unlikely.