USB connection not working VUSB
pin D- I have D- connected to a 68R
  resistor in series. The other end goes
  to my avr. I wired a 1.5K pull in
  parallel to the 68ohm resistor. A
  zener 0.5w 3.6v parallel to pin 2 of
  the type A socket.


sounds like your pulling D- up to your board's supply (it should be pulled up to 3.3V), at least i think thats what your trying to say.  If the 1.5k is actually in parallel with the 68 ohm resistor, that is a problem.

As you haven't connected the ground from the USB link, the other end has no reference at all for what you've pulled that pin up to.  Nor is your controller seeing the pull downs on the host side of the link.

Connect the ground from the USB link to your board ground.