Well I finally got a little time to work on the bike and try and figure out the problems. The encoder is working just fine. I collected some samples from it using an arduino uno and a bunch of alligator clips connected to 5v, Gnd, Sin, and Cosine. I now just need to look at the datasheet for the RMB28 that is on it and figure out what the Kelly controller wants to see.

Arduino Pin Read (Raw Data)