OK this is is kinda working the way I want it to. I place this as an Update Function in my Alien Zombie AI script:

function Update (){

    //The direction vector to our target
    var dir = (target.position - transform.position).normalized;
    var hit : RaycastHit;
    // Check for forward raycast
    if(Physics.Raycast(transform.position, transform.forward, hit, 20)){
        if(hit.transform != transform){
            Debug.DrawLine(transform.position, hit.point, Color.red);
            dir += hit.normal * 50;
    }

}

var leftR = transform.position;
var rightR = transform.position;

leftR.x -= 2;
rightR.x += 2;


if(Physics.Raycast(leftR, transform.forward, hit, 20)){
    if(hit.transform != transform){
        Debug.DrawLine(leftR, hit.point, Color.red);
        dir += hit.normal * 50;
    }
}
if(Physics.Raycast(rightR, transform.forward, hit, 20)){
    if(hit.transform != transform){
        Debug.DrawLine(rightR, hit.point, Color.red);
        dir += hit.normal * 50;
    }
}

var rot = Quaternion.LookRotation(dir);

transform.rotation = Quaternion.Slerp(transform.rotation, rot, Time.deltaTime);
transform.position += transform.forward * 1 * Time.deltaTime;

}

My Alien Zombies are moving around my terrain a lot better and seem to be able to move around trees a lot better. But they pass through my buildings to get at my FPS player. The video tutorial I followed mentioned that the wall needed to have a box collider on it and I understand the reason for that. But is there a way to get this to work with my "Mesh Colliders" that are already assiged to each part of my buildings?? I would hate to have to go around and add an additional box collider to every part of every structure that they could possibly pass through ;)

EDIT

Morten Do you mean like this:

function Update (){

    //The direction vector to our target
    var dir = (target.position - transform.position).normalized;
    var hit : RaycastHit;
    // Check for forward raycast
    if(Physics.Raycast(transform.position, transform.forward, hit, 20)){
        if(hit.transform != transform){
            Debug.DrawLine(transform.position, hit.point, Color.red);
            dir += hit.normal * 50;
    }

}

var leftR = transform.position;
var rightR = transform.position;

leftR.x -= 2;
rightR.x += 2;


if(Physics.Raycast(leftR, transform.forward, hit, 20)){
    if(hit.transform != transform){
        Debug.DrawLine(leftR, hit.point, Color.red);
        dir += hit.normal * 50;
    }
}
if(Physics.Raycast(rightR, transform.forward, hit, 20)){
    if(hit.transform != transform){
        Debug.DrawLine(rightR, hit.point, Color.red);
        dir += hit.normal * 50;
    }
}

var rot = Quaternion.LookRotation(dir);

var sizeOfMonster = 1.5;
var groundOffset = Vector3.up;
var newPosition = transform.position + transform.forward * 1 * Time.deltaTime;
if (!Physics.CheckSphere(newPosition+groundOffset, sizeOfMonster)){
transform.position = newPosition;
}

transform.rotation = Quaternion.Slerp(transform.rotation, rot, Time.deltaTime);
transform.position += transform.forward * 1 * Time.deltaTime;

}

I'm going to go out on a limb and ask if the "Monster Size" determines if they can pass through a wall or not, is that correct?

EDIT here is an image of how things are set up and hopefully it demostrates what my Alien Zombies are doing wrong. I added the debug code so I was much better able to adjust the parameters and center the sphere but as you can see they still just waltz right through my structures??