It works now that I started over from scratch, I have a block in all and a pass out all by default and NAT is working. I can see packets on both in and out-interfaces with tcpdump. Of course ICMP response is not being sent back since I have a block in all but at least NAT is working and it is forwarding packets.
I think what I was missing, a crucial step and basic knowledge to any networking tech, was the ins and the outs of gateways. I didn't understand what Out or In was in the eyes of the gateway. I now understand that Out is where the default gateway points, /etc/mygate, in other words egress group in ifconfig. And In is of course the opposite. This is a very subtle detail but it made a WORLD of difference. Thank you all for your support. :)
