We improved support for packaging persistence providers with the application but it sounds like that is not help you. Perhaps your not on the latest AS7 release. Which version of AS7 are you using? Try using either AS 7.1.1 or the nightly AS7 build.
If that isn't enough, enable TRACE logging for org.hibernate and org.jboss.as.jpa (see instructions here). Lets us know and attach the as7/standalone/log/server.log (after deploying your app with TRACE logging enabled).
Scott