I'm embarking on a project where accessibility to WCAG 2.0 and the ability to use the web application in the JAWS screenreader are key requirements.
I'm looking for insights as to how JAWS treats Javascript, is it a complete no go or is JAWS smart enough to cope!?
I'm a jaws user and the short answer is it mostly works. With out knowing your exact requirements I can't be very specific. Apps like gmail in basic html view work perfectly, gmail in normal view works although I use the jaws cursor a lot to simulate a mouse, stackoverflow works fine, google spreadsheets is completely inaccessible, google docs is mostly inaccessible, and google reader works fine although I have to use the jaws cursor to click on options like expanded or list view.
jaws doesn't know about javascript, it just reads screen and makes some actions. It's just a plugin for browser.
I was working on a project with similar requirements not so long ago. We've used YAML css framework which is designed for accessibility. And we've used only a few ajax and javascript improvements.
And I hope that this and this link will help you too.
You should look into ARIA, that is what the standards are moving towards to make JavaScript more accessible.