So to answer my own question - leaving off the timestamp portion is no longer working after the latest FB API update...
As a work around for the daylight savings time issue - in my code I call out to the /stats api for a single day (making start and end dates the same and leaving off the time portion):
/stats?start_time=2012-08-01T00:00:00&end_time=2012-08-01T00:00:00
I retrieve the results of this call and look at the times Facebook returned to determine if FB adjusted this query for the Clients daylight savings time.
FB return: "start_time": "2012-07-31T07:00:00+0000",
Then I can query the /adgroupstats api with the correct times:
/adgroupstats?start_time=2012-08-01T07:00:00&end_time=2012-08-02T07:00:00
Note: /adgroupstats api does not seem to return the FB adjusted start time so I used /stats api as a work around