No vertical movement in first person look animation

I am at the point where I need to make a few blend animations to get my character ingame. I got his basic animation sequences in, even got the triggers working!

I Followed Rex's awesome Milkshape blend tutorial to setup the animation sequences in Milkshape.

1) I copied the root pose keyframe as the reference frame for the head movement
2) I rotated the head to look up and then down. This rotated the eyenode also of course, looks fine in Milkshape.
3) I exported this sequence as a blend, named head
4) 1) I copied the root pose keyframe as the reference frame for the head movement
5) I rotated the arms only to be pointing very far up, then very far down. The head and eye remained looking straight ahead.
6) I exported this sequence as a blend, named look
7) I set up the .cs file, added in:

sequence7 = "./player_look.dsq looknw";
sequence8 = "./player_look.dsq look";
sequence9 = "./player_head.dsq head";

Ingame, in third person, my char can look up and down, the head follows the hands. But in first person, I cannot move the head up or down at all. The hands and weapon are not visible, and the crosshair will not budge up or down, only left or right. If I go into third person and move the mouse up, he will aim up, but then when I switch to first person it remains aimed up, won't budge up or down.

Wierd! Any thoughts?