Okay so I did some messing around, we're actually overlaying some jar files that contain web content as well. This seems to throw a validation error in the pom file overlay [dependency] is not a dependency of the project where dependency is clearly defined. We ignore it because maven itself seems to handle this just fine. In fact maven can handle overlays of types other than war files including jars and zips. But now I'm wondering if this is the cause of the failure as far as m2e-wtp is concerned. I removed those dependencies just to see if it would deploy correctly but nothing has changed yet. Ill keep playing around with it here.
This is the org.eclipse.wst.common.component file with those dependencys removed (no more errors). Does this look closer to what it should be? (webscan-lib is the war project that should deploy)
{code:xml}
<?xml version="1.0" encoding="UTF-8"?>
<project-modules id="moduleCoreId" project-version="1.5.0">
<wb-module deploy-name="pps">
<wb-resource deploy-path="/WEB-INF/classes" source-path="/src/main/resources"/>
<wb-resource deploy-path="/" source-path="/target/m2e-wtp/web-resources"/>
<wb-resource deploy-path="/" source-path="/src/main/webapp"/>
<dependent-module archiveName="webscan-traffic-1.0-SNAPSHOT.jar" deploy-path="/WEB-INF/lib" handle="module:/resource/webscan-traffic/webscan-traffic">
<dependency-type>uses</dependency-type>
</dependent-module>
<dependent-module deploy-path="/" handle="module:/overlay/prj/webscan-lib?includes=**/**&excludes=META-INF/MANIFEST.MF">
<dependency-type>consumes</dependency-type>
</dependent-module>
<dependent-module deploy-path="/" handle="module:/overlay/slf/?includes=**/**&excludes=META-INF/MANIFEST.MF">
<dependency-type>consumes</dependency-type>
</dependent-module>
<property name="context-root" value="pps"/>
<property name="java-output-path" value="/pps/target/classes"/>
</wb-module>
</project-modules>
{code}