mr kmthorne, when you open your lidar data ( jped or tiff file), in arcgis its already in raster . why you want to convert it to raster before hand ? if you want to change in Esri grid format, you can do it by by arctoolbox >conversion> to raster> raster to other format !! As you said you were able to import it as pointfile (X,Y,Z) then rasterrize it by arctoolbox >conversion> to raster> point to raster ! hope that helps !

Thank you very much for your help. I will give your ideas a try. I would like to be able to look at the (x,y,z) values in arcgis and my understanding is that a tiff or jpeg will not have those value since they are image files. Thanks again!