capncapo, I am replying here because this could be what another user is doing wrong too.
Logged into your install and checked your usergroup mappings. There was no mapping for registered user. When I mapped registered users to "Contributer" then the user would port over. Remember, these groups refer to the PRIMARY user group, not secondary.
The VB username you set up for me to test was a registered user (in the registered user usergroup), therefore since he was not mapped, he did not bridge. Usergroups that are not mapped will not be bridged to WP.
It appears to be working fine for me.
You will notice the login link is still there because your template (sidebar.php) uses the wp_loginout() function, where it would probably be better not using it. Something along the lines of:
Code:
<?php
if ($vbulletin->userinfo[userid] > 0) { echo "Logout"; } else { echo "Login"; }
?>
Would be better.