> Any ideas of how this can be fixed?

I'd suggest using a machine running OpenVPN at either end.  Create the
VPN, make sure each machine is able to forward packets, create the
static routes on the m0n0walls and you're done (see howto at
openvpn.net for better information).  Make sure each network is on a
different subnet though.
Sorry it doesn't answer your question but I think it's the best solution.