>  
> The problem I have now is when the build fails, say due to a unit test, the
> status of the build is SUCCESS.  Although the log states FAILED.
>  
> Is there some configuration I am missing here or is the problem related to
> me setup?

It is a known issue in 2.0.7. http://jira.codehaus.org/browse/MNG-3084

You can update the bat file in your local install as described in the bug and it will start working.

Emmanuel