It was the IOS!

It was the IOS!!!!!
I had been using c3640-jk9o3s-mz.124-16.bin. Changed it to c3640-i-mz.122-46.bin
and that was it, return icmp echo-reply packets got natted back
hmmm, i thought they use the 12.4 version IOS in the exam lab - yikes!

*Mar 1 00:33:08.795: IP: tableid=0, s=10.1.1.3 (Ethernet0/0), d=201.114.37.5 (Serial1/0), routed via RIB
*Mar 1 00:33:08.795: NAT: i: icmp (10.1.1.3, 2) -> (201.114.37.5, 2) [2]
*Mar 1 00:33:08.799: NAT: s=10.1.1.3->204.15.86.3, d=201.114.37.5 [2]
*Mar 1 00:33:08.803: IP: s=204.15.86.3 (Ethernet0/0), d=201.114.37.5 (Serial1/0), g=199.100.35.253, len 100, forward
*Mar 1 00:33:08.803: ICMP type=8, code=0
*Mar 1 00:33:08.959: NAT: o: icmp (201.114.37.5, 2) -> (204.15.86.3, 2) [2]
*Mar 1 00:33:08.959: NAT: s=201.114.37.5->10.1.3.1, d=204.15.86.3 [2]
*Mar 1 00:33:08.963: NAT: s=10.1.3.1, d=204.15.86.3->10.1.1.3 [2]
*Mar 1 00:33:08.967: IP: tableid=0, s=10.1.3.1 (Serial1/0), d=10.1.1.3 (Ethernet0/0), routed via RIB
*Mar 1 00:33:08.967: IP: s=10.1.3.1 (Serial1/0), d=10.1.1.3 (Ethernet0/0), g=10.1.1.3, len 100, forward
*Mar 1 00:33:08.971: ICMP type=0, code=0

-a.c