Hi Kevin,
I couldn't figure out why the filtering didn't work. So, I re-grouped and revisited it. Seems after 30 plus years doing this type of work I still haven't learned one of the fundamental lessons one should never forget; ATTENTION to DETAIL. When I configured the channel node I selected Digital Input instead of Counter Input for the enabling and filter. Duh!
When set up correctly it worked great. I also cleaned up the signal some with a couple capacitors. FYI....I also installed a ferrite core just like the picture in the Ni user manual. It made no difference. I didn't think it would as this problem is not noise (which what ferrite cores are for) but rather a PWM signal embedded in a PWM signal as I stated earlier. Two different critters.
Thank you for your help!