I've had the same problem. Here is what has worked for me:
1) Create a blank ConfigurationParameterSettings object using the
CPE factory:
CasProcessorConfigurationParameterSettings settings =
CpeDescriptorFactory.produceCasProcessorConfigurationParameterSettings();
2) Set your settings, e.g.,:
settings.setParameterValue("PARAM", value);
3) Then, set the settings of your processor
processor.setConfigurationParameterSettings(settings)
4) Finally, add the processor to your CPE
cpe.addCasProcessor(processor);
The CPE xml only ever contains a path to each component descriptor and
doesn't actually know about the settings until runtime.
hth,
Andy