My problem is, after implementing this, certain users who used to have access to a subsite reserved for managers no longer have direct access. Strangely though, when the Access Denied.aspx page is displayed, there is a link to go back to the Site, and when clicked will take the user to the correct spot in the subsite. Users with Full Control have no problem accessing the site through the menu. Most of the user's for this subsite are stored in Active Directory groups, and those AD groups are assigned permissions. The AD groups assigned are given Limited Access.
In my custom masterpage template, I deleted the old SharePoint tag for navigation and inserted a blank div tag with which my JS uses to create the navigation. This div tag is not placed in the same spot as the old SharePoint tag, but a little higher up, right before div with class of "s4-lp s4-toplinks"
Just wondering if anyone had any ideas with regards to permissions and custom navigation menus. For legal reasons I cannot show code, but I can explain the best I can if anyone should ask.