After doing some research I saw some examples using jquery's .ajax function and webmethods for autocomplete with ashx in Sharepoint.
http://encosia.com/3-mistakes-to-avoid-when-using-jquery-with-aspnet-ajax
I guess my question boils down to.
any Security requirements in IIS using ashx ? I would assume it would still be as secure as the page that it is on, right? Is there any performance gain/loss by going the webmethod route?
Any other suggestions are more than welcome