Thanks for the reply. I do have a forearm joint mid-way up the forearm that is taking part of the rotation. However, the problem occurs not when I rotate wrist but when I animate the arm in general (I'm using IK). I know some basics of rigging but this is more troublesome than I'm used to. There are ways around this deformation (for the most part) if I keep the arm for performing any "extensive" motions I can keep it out this "deformation zone". I was able to get a pretty decent walk cycle out of it, but when I went for a simple arm swiping/slashing motion, it went crazy.
I thought it might be the rotation limits but when I would select the joint, (with the deformation in place) it wouldn't un-deform, just deform more.
Thanks again,
Brandon.