Ok here is what I did to try and resolve this.
I deleted the usps shipping option from my admin in my cart.
I then went into my cpanel, file manage, public htp root, public_html, includes, modules, shipping and then uploaded the may 2008 patch.
Then went back to my admin and installed the usps mod.
Then added an item to my cart and attempt to estimate postage for an international country. The system allows you to pick a country and a area within that country and then that is it. It does not show any shipping options what so ever.
If you need more information I don't know what to give you. Thank you!