Thanks, I found that thread here:
http://www.linuxquestions.org/questi...&highlight=ssh
I had forgotten about /etc/motd but after reading that thread, I took at look at rc.S and the same line about updating /etc/motd with the correct uname -r is commented out. I'll uncomment and allow /etc/motd to be updated automatically.
Strange that I never noticed this before. I compile my own kernels all the time and use ssh every day and never noticed that the kernel version was wrong.
Interesting. Learn something every day.
Thanks, mdarby.