Thanks Rafael.
I does seem that it has something to do with the Linux running. When I removed the SD card so that the board had nothing to boot from - the debugger connected to the CPU. Of course, now I have no code on the board to debug...
Do you have a suggestion how would I connect before Linux boots (as you suggested)?
I'm going to look into who or what disables JTAG and I'll visit the device forum too. If you have any other suggestions I'll be thankful.
Freddy