Ash, I am trying to solve the same problem. When I saw the "Access Denied" error I also noticed that ( inspite of referencing jQuery 1.8 in my masterpage) the error was coming from jQuery 1.4 When I added a reference to the newer jQuery and SP Services libs on my page, the error went away.
Now while no errors are thrown, I am still not getting anything returned.
Now while no errors are thrown, I am still not getting anything returned.