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So, as a final followup to this question here is what we finally did to completely automate this process.

We did, as was suggested, use the ApplicationResourceFile element in the manifest file.

<?xml version="1.0" encoding="utf-8"?>
<Solution SolutionId="{185E973C-3A10-4e2a-9E0F-DC14414551F9}"
          xmlns="http://schemas.microsoft.com/sharepoint/"
          DeploymentServerType="WebFrontEnd">
  <ApplicationResourceFiles>
    <ApplicationResourceFile Location="yourappname.resx"/>
    <ApplicationResourceFile Location="yourappname.en-US.resx"/>
  </ApplicationResourceFiles> ...
</Solution>
This did in fact put the files into the "resources" folder. So, we simply accessed the resources from there in code like so:
string appPath = HttpContext.Current.Request.MapPath(HttpContext.Current.Request.ApplicationPath);
ResourceManager resX = ResourceManager.CreateFileBasedResourceManager("ResourceFileName", appPath + "resources", null);
SPSecurity.RunWithElevatedPrivileges(delegate()
    AddResource(resX, "DefaultTextBoxLabelText");
We run this code in the constructor and add the entries from the resource file into a local dictionary. You must use RunWithElevatedPrivileges because the new "resources" folder that is created is only accessable by the AppPool account.
Application resource files cannot be deployed via a feature unless you execute some code and start a SharePoint timer job that copies the files to the App_GlobalResources folder on each Web front-end server.
You should instead let the SharePoint solutions framework deploy the .RESX files to the App_GlobalResources folder on each server. You can specify application resource files as follows in the manifest.xml file of your WSP solution package:
<?xml version="1.0" encoding="utf-8"?>
<Solution SolutionId="{185E973C-3A10-4e2a-9E0F-DC14414551F9}" 
          xmlns="http://schemas.microsoft.com/sharepoint/" 
          DeploymentServerType="WebFrontEnd">
  <ApplicationResourceFiles>
    <ApplicationResourceFile Location="yourappname.resx"/>
    <ApplicationResourceFile Location="yourappname.en-US.resx"/>
  </ApplicationResourceFiles>
</Solution>
When you deploy the WSP solution package using STSADM or Central Administration, the SharePoint solutions framework will start a timer job that deploys these files to the App_GlobalResources folder of all the Web applications you decided to deploy the solution to. 
                So, this seems very close but when I use the ApplicationResourceFile element it creates a "resources" folder and placed the file there not in the App_GlobalResources folder.
– webwires
                Nov 18, 2008 at 17:50
                According to mikhaildikov.com  The WSS solution manifest contains two elements with names that imply to have something to do with the deployment of RESX file. They are <ApplicationResourceFiles> and <Resources>. Unfortunately they are not really helpful and basically can be ignored.
– webwires
                Nov 18, 2008 at 18:21
                Sigh - this is an old bug in SharePoint that I was sure MS finally fixed with the infrastructure update. I cannot believe it is still there! But I would still recommend to go for the above solution and launch a one time timer job to copy the files from the resources folder to App_GlobalResources
– Lars Fastrup
                Nov 18, 2008 at 19:06
For SharePoint 2010 you need to change the XML node name so it will copy to the new App_GlobalResources folder instead of Resource folder in C:\inetpub\wwwroot\wss\VirtualDirectories\80 
MSDN link: http://msdn.microsoft.com/en-us/library/ms463158.aspx
Example:
<Solution SolutionId="{8a2f91f2-db85-4eb3-8e7c-330f05246e1a}"
          DeploymentServerType="WebFrontEnd"
          xmlns="http://schemas.microsoft.com/sharepoint/">
    <ApplicationResourceFiles>
        <App_GlobalResourceFile Location="yourResourceFile.resx"/>
    </ApplicationResourceFiles>
We recently ran into the same issue on our farm installation. Unfortunately, adding ApplicationResourceFile entries in the manifest only gets your resources to the Resources-folder.
While you can manually deploy the resource files from Resources to App_GlobalResources with stsadm -o copyappbincontent (must be issued on every front end server), we ended up creating a timer job to manually copy the files, as outlined here:
        
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