Do not use Eclipse to build your web service for you - I think that Eclipse bases its web services on Axis.
Did you install JBoss Tools into Eclipse? You could use that to build your web services (I think I did that once).
Have you built an run target 07 in project ch09? That builds a secured web client but uses the properties file (rather than a database) for login. Target 05 in ch08 builds a messaging client using the database for login, so you could use that as an example of switching the web service to using the database for login.
Also, try setting the log to TRACE for org.jboss.security.auth, that should give you some details of exactly what is going on. (From what you have provided I cannot tell if your code is incorrect (you did not provide the code), or if your database is not set up correctly. The trace might provide some insight into that.)