spcomputing,
As things turned out I had a bad 16u2, which I suspect is a pervasive issue with the 2560 board, but that is just an opinion. I received a full refund for the board and then bought two UNO R3's. Funny but everything simply behaves a LOT better as in everything works properly now. It really is a breeze vs. the amount of work the 2560 required to do the simplest da_m_n thing. Any way, my recommendation is to choose option (c) in you multiple choice comment stated earlier in this thread. Thanks for trying to help, I really appreciate it.
My pleasure. Sorry we could not get that 2560 up, but I am sure you will enjoy the Uno R3s much more. When you outgrow the Unos and are ready to try the 2560 R3 again, I will have more information and better software to work with the 8u2 and 16u2. I am going to add the hex for the two the Nick Gammon's programmer.
Anyhow, enjoy!