Thanks for the replies!
Figured it out and i will post it here in case anyone else runs into this problem. (Pics to follow.)
I went back with tools and a jack & stands. Jacked it up so I could get to the top bolt. Pulled the starter out and took it apart. Nothing wrong... checked the brushes and greased the gears while I was there and put it all back in the Jeep.
Hooked the battery back up and tried- same thing; cranked pretty good, but just chugged and chugged not quite starting. There was a squeaking sound (same as before) that had led me to believe the starter had an issue.
Decided to go after fuel at this point; I replaced the fuel filter with a new one, primed it and checked that the line to the pump was full. Cranked and still had the same almost start chugga chug crap going on- again with a little white smoke.
I got thinking that the squeaking sound might be a torque converter bolt that had backed out and was making it difficult to turn... I almost always find the problem is with the last item that I worked on or at least related. The problem with this theory is that we used loctite and were extremely anal about getting the 4 bolts torqued perfectly.
Decided to try it with the injectors unplugged- this time it didn't even try to start, so I plugged them back in. About this time a guy I work with came over to see what I was doing there on my day off. I asked him to crank it over while I listened. With him at the key I could hear that the squeaking was coming from the front of the motor. It was then that I spotted the slight rubber build up on the front of the thermostat area. When he stopped cranking I touched the area under the Viscous heater clutch and it instantly burned it. We pulled the belt off and the motor started right up easily.
I am somewhat embarrassed, but then again, I am not a professional diesel troubleshooter so cut me some slack please.
Turns out that the bearing in the viscous heater clutch is burned out. It is just like an A/C clutch. Dealer couldn't find it when I called about it, so I pulled it out and headed down there- after a long search he finally found it- Part # 55037539AA. Net $777.00 but he could give it to me for $699!!! Ouch.
I didn't order the part. I am going to try and replace the bearing and coil myself. I recently repaired my wife's VW TDI A/C clutch for $35 this way. The only way to get the part is to buy the whole compressor-what a waste. I will take pics of the process and post any part numbers in hopes that others may avoid the $699 wallet bomb.