WELL, FIGURED IT OUT!
Got a tip to try and see if DNN actually had permissions to make changes via the Configuration Manager. We got an internal error. Went back and re-checked the permissions.
1) We found that SERVER 2012 and AppPools in IIS8 is very exacting? Needed the Permissions RE-MOVED and RE-APPLIED. We then recycled the app pool and DNN WORKED!
Web Admin can make changes and view them after logging out of dnn app.
Not sure if this will work for everyone in the future but our issue was "permissions" just seemed to be hung and needed to be removed and re-applied in server 2012 folder permissions,SQL 2012 and AppPools in IIS8+
Strange things do happen. All i can say is "GO FIGURE!"
Oh by the way, special thanks to "Mitchel Sellers" for the tip testing the Via the host configuration manager. Once I found this was not granted access based on his tip? This confirmed I had a serious permissions issue although the site was visible. Removing the Permissions completely and re-applying actually worked with IIS8 and Server 2012 in this instance. NOT REALLY SURE WHY... maybe the server really hit a glitch or got hung on the permissions? Still strange....
So for me this issue is now CLOSED.... I can now go back to designing web sites....
again, all i can say is... "GO FIGURE!" Thank you everyone for your posts on this issue.