Off the top of my head I seem to remember seeing the same error when when there were 2 copies of the xerces jars in my lib and endorsed folders, which were different versions. I think there may be one bundled in with LCDS war file which is causing the conflict, but I've definitely resolved that exact error message on my scratch server before.
If you haven't solved the issue yourself yet, could you find all the xerces*.jar files under the jboss folder and post up the list here, including file sizes?