Marc, thanks for jumping in. Here is what I am using for a test case. I don't see anything different other than a space after the comma. After testing I found that the space is REQUIRED for this call to work correctly... Mystery solved.
var values = [
["Title", "Test websvc add"],
["linky", "http://www.google.com,Google"]
];
$().SPServices({
operation: "UpdateListItems",
async: false,
batchCmd: "New",
listName: "{34F5F005-0B18-4D48-BCE4-6293D5A523F6}",
valuepairs: values,
completefunc: newEntryCompletion
});