I have no experience with Arduinos, but shouldn't the code be something like this instead?
while(Serial.available())
{
letter=Serial.read();
Serial.print(letter);
}
Also, make sure that the data lines are connected properly.
http://www.digi.com/resources/documentation/DigiDocs/90002002/default.htm#reference/r_zb_pin_signals_th.htm