Strangely enough the above config started working. I did remove the interfaces from the rstp. For some reason it must be an arp issue. Pings and traffic flow between switches now. The above config works. I did add the flowing to make sure CDP works and it does.
layer2-control {
mac-rewrite {
interface ge-0/1/2 {
protocol {
cdp;
}
}
}
}