Quote from Zaphodmake sure you have
"$envmap" "env_cubemap"
"$normalmapalphaenvmapmask" "1"
Don't even bother with this until the SDK is updated. Valve left some sort of source control precaution in the software that prevents CS:S from actually building your cubemaps (the console command buildallcubemaps results in a message basically telling you off because you don't have the map checked out.) Which is especially odd because all the maps rely on cubemaps for a lot of their visual appeal and in the sdk YOU CAN'T EVEN MAKE THEM. Good catch ya'll.
In addition, if you try to do terrain painting with multiple textures blended together. Forget that too, they broke it as well.
So until the SDK is updated mappers are up shits creek.
What a let down.