also try referencing ur custom css  under in simple.master page  just before closing </HEAD> tag. I hope you have used the same class names thats there in core.css to override  ur sharepoint styles.

but any other way without touching the simple .master
as i am relatively new to MOSS dev , my architect is asking me to do without touching it, he is saying if required i can go ahead a creating a new masterpage

any pointers ....

1. easiest way is take a copy of simple.master and rename and use the renamed master page  for accessdenied page.

2. Another approach is create your own layout page and in web.config you can redirect the user to ur custom  page.

3. Write an httpmodule which will get fired on each and every request and inside that u can check the current page url and inside url if you find acceessdenied.aspx then u can apply ur custom master page using sharepoint object model at run time.

I hope above methods are useful.