This seems to be related to an issue with the 3524 switch. If I keep both clients on the same VLAN (and proper subnet) on the 3524 then it is fine. However, if I try to separate them then neither VLAN can ping the gateways or each other. So basically the functionality I was able to do above with the 5548, I cannot duplicate on the 3524. UPDATE!: It is working! My configs are all good now. So I can ping each client on different switches. It seems that the 3524 may have some limitations on the number of vlans it can send through a trunk. When I just have VLAN1 (for general traffic) and VLAN12 routing works properly. However, when I try to put VLAN1, VLAN11 AND VLAN12 on the 3324, I am no longer able to send anything through the trunk. (Even though both 11 and 12 are tagged as allowed on the trunk) 
Let me start by saying this seems like I am missing something obvious. I am trying to add VLAN segmentation to a network that is already up and running so I keep taking baby steps and I am trying to get an end-to-end test before rolling out in a larger way. We are in a collapsed core configuration with a N4032F acting as the core and for the sake of this test a 5548 and a 3524 connected to it.  On the 3524 I have a client connected to 1/e7 and set to VLAN 12. Another client on the 5548 on gi1/0/6 and set to VLAN 11. Both are simple 24 bit subnets (192.168.70.0 and 192.168.50.0 respectively).  The clients can ping their gateway (192.168.xx.1) and even ping the opposite gateway (192.168.50.10 can ping 192.168.70.1 and vice versa).  However, the clients cannot ping each other. Something is not configured properly to route the packets to the opposite vlan and I am stumped! I am new to VLAN configurations, but thought I was pretty much there because I could ping all related gateways for routing.  Any assistance would be greatly appreciated. 
InterVLAN Routing - N4000