Finally got a chance to check this. I created a sub-domain, clean install of Joomla, clean install of CB (dev.cloud9.aero). The only thing I did in the administration is set the registration in CB configurations to 'Yes, independent of CMS "allow registration". Oh, and I had to create a menu item (community builder registration form). Still same issue.

Just got off the phone with the hosting company this morn. I had also created an exact duplicate of the fresh install, but this time on my inMotion server (which is the same standard shared hosting as the one with the issue). Of course the from email is different, but that's about it. Worked perfectly on my server. Hosting company asked for credentials for both so they could compare. They couldn't figure out why one is behaving differently and also suggested using SMTP. I didn't think I had that option, but it turns out that I do. And that worked as a word-around. The only difference between your suggestion is that its going through my server instead of GMail. I'm sure either would work. Thanks again, Kyle, for helping out with this and hopefully the thread helps others that run into the same issue.