Ok. After around 20 more iterations I cannot figure out what's wrong. Oh well. One thing that is weird is that when I play the game in the editor it uses my custom scripts (game type, player controller, etc) but when the game is packaged the game uses the standard UDK voice pack and robot gibs. Both the ini's and World Properties are set to use my game and game type. ? Bizzare. And finally, I tried replacing the standard loading screen with my own by changing the bik file. The packaged game loading screen is still the red one with the deathmatch tips. I looked for this screen but couldn't find it anywhere in the UDK folders. Even in the m4v files nothing like it exists. I guess it makes sense that Mac's might not use the bik files but I can't find the Mac load screen anywhere. Although it probably doesn't matter because the game hangs on that screen during re-load anyway.
So, what I did to fix my problem was to exit the game on death instead of re-load. This somewhat works for my game because it's more of an art project as opposed to a standard game. This is probably not an option for anyone else. I really thought I could figure this out but to no avail. I may come back to it later.
If anyone figures this out please post your findings! Thanks!