I have been working on a site and have decided to change the design pattern to use the Zend Framework. I have created a new virtual host to do this work on. So I have set up a directory structure, with Zend in the includes directory and I'm using Smarty as a template engine, which is in there also.

Now in this new virtual host when I go to the domain on my machine example.blar/ the page loads fine and the css files too, but something is going very wrong with the external JavaScript files. When viewing the page source in the browser I can click on the script src attribute and the JavaScript file is shown (jQuery).
But if I put an embedded script into the document and try to use anything from jQuery, eg, $(document).ready(), I get a blank page with no errors or anything.

I have tried
HTML Code:
<!DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Strict//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-strict.dtd">
<html xmlns="http://www.w3.org/1999/xhtml" xml:lang="en" lang="en">
<html>
	<head>		
	<meta http-equiv="Content-Type" content="application/xhtml+xml; charset=utf-8" />
		
	<title>example.blar</title>		
	<base href="http://example.blar" />
	
	<script type="text/javascript" src="/libs/jquery.js"></script>
	<link href="/css/example.css" rel="stylesheet" type="text/css" />
		
	<script type="text/javascript">
               // to see if jQuery has loaded
		$(document).ready( function() {
			alert("ready");
		});
	</script>	    
	</head>
if i take out the little test script it loads fine and I can even look at what has loaded using firebug.

This has been driving me mental, can anyone help??