Url aliases/global redirect not being used in Custom Blocks
Found the answer.  Sort of surprising since I don't think it's uncommon to run Drupal from a subdirectory (im my case, "drupal") and hide the fact through .htaccess rewrites.  Anyhow, doing exactly that breaks Global Redirect.

The fix is unfortunately hacking the module until it's addressed.  See here:
http://drupal.org/node/976214