When you say it is recognizing your CAC in the System.log I think you are referring to the Token identifier you see as "CAC-5FFF-7F00-69FF-00F0-0592". What I fear is your issue is that the card you are using is not actually properly recognized by the Tokend. Allow me to explain. The identifier "5FFF-7F00-69FF-00F0-0592" *should* match the 20-digit alphanumeric identifier printed at the top of the back of your card.
If the two (printed identifier Keychain Identifier) do not match, then there is an issue with the Tokend in use. If that is the case, please submit a ticket [
http://smartcardservices.macosforge.org/trac/newticket ] with all of the relevant information from your system (ie. system profiler) and information about your card (ie. CAC, CACNG, PIV, PIV-I, Manufacturer Branding name. Note on the wiki, blog and installer that the CACNG Tokend only supports the Gemalto TOPDLGX4 144 - ONLY at this time. If you have the Oberthur ID One card, it may not work at this time.