GM advises that there is a stock option engine brake on the 06 LLY and LBZ. I am not sure on what they are talking about. Does any body know of a stock GM engine brake for the Duramax??

I'm not sure what advertising you are talking about, as I've not seen it. Maybe it was in reference to the Allison down shifting? Or perhaps you were looking at the medium duty (4500) line.

"Another new feature of the DURAMAX 6600’s turbo system is the capability of the variable-geometry turbocharger to provide exhaust braking. This function is available on some medium-duty truck models and can replace add-on exhaust brake hardware. With the new system, braking is controlled by a signal from the engine controller and can be activated by the driver."

This was listed in the LBZ and LLY differences section. Can this be added to any 2500 HD series? If so how does it work?

Only applies to the med. duties.
Brayden (member here) makes a boost controller that can function as an exhaust brake IIRC.

I can hear my LBZ doing somthing that sounds like an exhaust brake when im coming off the freeway. Its not very loud but you can hear it.

is it possible to look at the tuning to the 4500 and apply it using efilive to a 2500hd?

I can hear my LBZ doing somthing that sounds like an exhaust brake when im coming off the freeway. Its not very loud but you can hear it.

That is the grade braking feature of you Allison Transmission..

yup grade stoping when pulling the weight .The trany downshifts with the weight on the down hill grade.One of the features of the ally.

Yep, X-2