Environment Light settings

Colorbleeding (also used to calculate ambient occlusion)
Environment color: black
Intensity: 1.0
ONLY emit diffuse
Bake Shadowing: RenderRadiosity (check settings two posts down)
Environment Sampling Mode: Sampled
Samples: 512
Max Variation: 0.5 (IMPORTANT! This will take out all the ugly square artefacts in ambient occlusion pass)
Max Distance: 50 - 100 (depends on how your ambient occlusion looks)
Falloff Mode: maxdist-based

Spec

Environment image: hdr_mountains1.exr (found in light-vdev_rig>light-vdev_rig.proj>sourceimages)
Intensity: 1.0
ONLY emit specular
everything else the same EXCEPT...
Max Dist: measure from Gus to environment light 
Max Variation can also be taken up to 2.0