Ok, so i figured it out, but I have a sub-issue to report as well, I am using the SqlMembershipProvider and this is working fine, I also have my own Epi Admin user so i had to add it to the Framework.config file in the following lines:

<add roles="WebAdmins, Administrators, EpiServerAdmin" mode="Any" name="PackagingAdmins" type="EPiServer.Security.MappedRole, EPiServer.Framework" />
<add roles="WebAdmins, Administrators, EpiServerAdmin" mode="Any" name="CmsAdmins" type="EPiServer.Security.MappedRole, EPiServer.Framework" />

My sub-question is, while i see the virtual roles for CmsAdmins, Anonymous, etc in the "Set Access Rights" under admin mode to set these rights - I DO NOT see these roles when i try to assign them to a user - how do i get these virtual roles to show up and be able to add them to a user (this would stop me from having to use my own episerveradmin role)

Check in your EPiServerFramework.config that your user is member of the virual group named PackagingAdmins.

http://world.episerver.com/Documentation/Items/Developers-Guide/EPiServer-Framework/7/Add-Ons/Add-ons/

Here is my EPiServerFramework.config

<episerver.framework>
  <scanAssembly forceBinFolderScan="true" />
  <siteHostMapping>
    <siteHosts siteId="PhoenixCMS_RC">
      <clear />
      <add name="*" />
      <add name="phoenixcms.bbb.local" />
    </siteHosts>
  </siteHostMapping>
  <automaticSiteMapping>
    <add key="/LM/W3SVC/12/ROOT:16L-COCKRELL" siteId="PhoenixCMS_RC" />
    <add key="/LM/W3SVC/1/ROOT:MATTHEW-MBP" siteId="PhoenixCMS_RC" />
    <add key="/LM/W3SVC/4/ROOT:W2K8R2-KUMAR" siteId="PhoenixCMS_RC" />
    <add key="/LM/W3SVC/1/ROOT:CBBB-DEV01" siteId="PhoenixCMS_RC" />
    <add key="/LM/W3SVC/2/ROOT:CBBB-DEV01" siteId="PhoenixCMS_RC" />
    <add key="/LM/W3SVC/3/ROOT:CBBB-DEV01" siteId="PhoenixCMS_RC" />
  </automaticSiteMapping>
  <virtualPathProviders>
    <clear />
    <add virtualPath="~/episerver/" physicalPath="[appDataPath]\Modules" name="ProtectedAddons" type="EPiServer.Web.Hosting.VirtualPathNonUnifiedProvider, EPiServer.Framework" />
    <add showInFileManager="true" virtualName="Page Files" virtualPath="~/PageFiles/" bypassAccessCheck="false" indexingServiceCatalog="Web" useRouting="true" customFileSummary="~/FileSummary.config" physicalPath="[appDataPath]\SitePageFiles" name="SitePageFiles" type="EPiServer.Web.Hosting.VirtualPathVersioningProvider, EPiServer" />
    <add showInFileManager="true" virtualName="Global Files" virtualPath="~/Global/" bypassAccessCheck="false" indexingServiceCatalog="Web" useRouting="true" customFileSummary="~/FileSummary.config" physicalPath="[appDataPath]\SiteGlobalFiles" name="SiteGlobalFiles" type="EPiServer.Web.Hosting.VirtualPathVersioningProvider, EPiServer" />
    <add showInFileManager="true" virtualName="Documents" virtualPath="~/Documents/" bypassAccessCheck="false" maxVersions="5" useRouting="true" customFileSummary="~/FileSummary.config" physicalPath="[appDataPath]\SiteDocuments" name="SiteDocuments" type="EPiServer.Web.Hosting.VirtualPathVersioningProvider, EPiServer" />
    <add virtualPath="~/App_Themes/Default/" physicalPath="C:\Program Files (x86)\EPiServer\CMS\7.0.586.1\application\App_Themes\Default" useRouting="true" name="App_Themes_Default" type="EPiServer.Web.Hosting.VirtualPathNonUnifiedProvider, EPiServer.Framework" />
    <add virtualPath="~/episerver/CMS/" physicalPath="C:\Program Files (x86)\EPiServer\CMS\7.0.586.1\application\UI\CMS" name="UI" type="EPiServer.Web.Hosting.VirtualPathNonUnifiedProvider, EPiServer.Framework" />
    <add virtualPath="~/Util/" physicalPath="C:\Program Files (x86)\EPiServer\CMS\7.0.586.1\application\util" name="UtilFiles" type="EPiServer.Web.Hosting.VirtualPathNonUnifiedProvider, EPiServer.Framework" />
    <add virtualPath="~/WebServices/" physicalPath="C:\Program Files (x86)\EPiServer\CMS\7.0.586.1\application\webservices" name="WebServiceFiles" type="EPiServer.Web.Hosting.VirtualPathNonUnifiedProvider, EPiServer.Framework" />
    <add name="CMOWebServices" virtualPath="~/CMOWebServices" physicalPath="C:\Program Files (x86)\EPiServer\CMS\7.0.586.1\Install\Modules\CMO7.0.518.1\CMO\..\CmoWebServices" type="EPiServer.Web.Hosting.VirtualPathNonUnifiedProvider, EPiServer.Framework" />
    <add name="CMO" virtualPath="~/CMO" physicalPath="C:\Program Files (x86)\EPiServer\CMS\7.0.586.1\Install\Modules\CMO7.0.518.1\CMO" type="EPiServer.Web.Hosting.VirtualPathNonUnifiedProvider, EPiServer.Framework" />
  </virtualPathProviders>
  <virtualRoles replacePrincipal="true">
    <providers>
      <add name="Administrators" type="EPiServer.Security.WindowsAdministratorsRole, EPiServer.Framework" />
      <add name="Everyone" type="EPiServer.Security.EveryoneRole, EPiServer.Framework" />
      <add name="Authenticated" type="EPiServer.Security.AuthenticatedRole, EPiServer.Framework" />
      <add name="Anonymous" type="EPiServer.Security.AnonymousRole, EPiServer.Framework" />
      <add roles="WebAdmins, Administrators, AddonAdmin" mode="Any" name="PackagingAdmins" type="EPiServer.Security.MappedRole, EPiServer.Framework" />
      <add roles="WebAdmins, Administrators, EpiServerAdmin" mode="Any" name="CmsAdmins" type="EPiServer.Security.MappedRole, EPiServer.Framework" />
      <add roles="WebEditors" mode="Any" name="CmsEditors" type="EPiServer.Security.MappedRole, EPiServer.Framework" />
      <add name="Creator" type="EPiServer.Security.CreatorRole, EPiServer" />
      <add name="CmoUsers" type="EPiServer.Cmo.Cms.Security.CmoUsersRole, EPiServer.Cmo.Cms" />
      <add name="CmoAdmins" type="EPiServer.Cmo.Cms.Security.CmoAdminsRole, EPiServer.Cmo.Cms" />
    </providers>
  </virtualRoles>
  <geolocation defaultProvider="maxmind">
    <providers>
      <add databaseFileName="C:\Program Files (x86)\EPiServer\Framework\7.0.859.1\Geolocation\GeoLiteCity.dat" name="maxmind" type="EPiServer.Personalization.Providers.MaxMind.GeolocationProvider, EPiServer.ApplicationModules" />
    </providers>
  </geolocation>
  <appData basePath="C:\Sites\PhoenixCMS\VPP\" />
</episerver.framework>

    I'm not seeing any virtual group definitions - unless you mean the stuff inbetween <virtualRoles>

So there's no way to set a user from the UI to one of these virtual roles?

http://webhelp.episerver.com/CMS/7.1/EN/Default.htm#Authorization/Admin_IN_WorkingWithAuthorization.htm%3FTocPath%3DAdministering%20the%20Site%7CAccess%20Rights%7C_____0

Thanks Guys! So this line in that documented you posted Mark, is very telling:

WebEditors, WebAdmins and VisitorGroupAdmins groups are configured but not automatically available, these must first be created in admin mode before usage. This configuration is normally done when the website is set up.

So i'm guessing I needed to manually add these groups to my SQL Roles and they would automatically hook up.  Make's sense now (hoping my assumption is right :D)

You should be able to map any arbitrary SQL role to PackagingAdmins (in episerverframework.config).

<add name="PackagingAdmins" roles="WebAdmins, Administrators, EpiServerAdmin, SQLROLE" mode="Any" type="EPiServer.Security.MappedRole, EPiServer.Framework" />

You don't need to create WebAdmins. But if you like to reuse the name, you could define it as a virtual group like this:

<add name="WebAdmins" roles="SQLROLE" mode="Any" type="EPiServer.Security.MappedRole, EPiServer.Framework" />

This way, all existing rules for WebAdmins will automatically work for "SQLROLE".