Rackspace - mod_rewrite index.php issue

I recently moved my site into the Rackspace environment, I have everything working fine except one item that is making me nuts.

The mod_rewrite to remove index.php works everywhere, except with the Pages add on.

I have numerous entries set up with this for static pages like terms of service etc. so that the pages are set up like: www.site.com/terms.php this is bringing me to a page not found page, and not even redirecting it to my 404 page I have set up as a default everywhere else.

Currently, just with these Pages settings, I can only see the page with index.php in the URL like this - www.site.com/index.php/terms.php or if I use the full path to the static template - www.site.com/home/static/terms

Hopefully some has run into this previously?