Is it correct to say that the (-) neg terminal of the 9V battery and all GNDs of circuit get tied together to a GND pin on the Ardunio board? If so, then the 9V battery is not enough voltage to output 5V thru the voltage regulator. Why does the voltage decrease across the voltage regulator when I attached the sensor's and resistor's GND to (-) neg terminal of the 9V battery?
Even though I can agree with your answer I see on Wikipedia that my Zinc Chloride (zinc carbon) battery has a typical 400 MAh rating. That would make me think 150mA isn't all that much to draw from a 9V battery.http://en.wikipedia.org/wiki/Nine-volt_battery