evanlee, For a classical system, your statement that "temperature is defined as average kinetic energy" is close but not exactly correct. For a classical ideal gas the average energy per molecule turns out to be <E> = (3/2) kT. But this is a result, not a definition of T! It is true that according to this formula, thermal motion appears to stop at absolute zero.
However as a real system approaches absolute zero it will differ from this formula. Quantum effects become important, and what happens depends on whether the system is composed of bosons or fermions.
But in the first place, near absolute zero most things freeze! In a solid atoms do not move freely about, and thermal motion consists of collective vibrations of the lattice (phonons). This makes an important difference. To talk about the thermal properties of such a system near absolute zero, we may consider the phonons to be a gas, but it's a different kind of gas in which the number of particles is not fixed. For this reason you can no longer talk about the energy per particle, rather the energy per volume. It turns out that as T goes to zero, <E> ~ T4. The same is true of a gas of photons (black-body radiation) which are also bosons.
Another type of system is He4. As you know He4 becomes a superfluid below a critical temperature Tc, about 4 K. At this point the system becomes inhomogeneous, splitting into two phases with a fraction of the particles forming a condensate. This comes closest to your idea that absolute zero means p = 0. Consistent with the uncertainty principle, particles in the condensate are nonlocalized, meaning their wavefunction extends over a macroscopic distance.
The third type of system is a gas of fermions. Two fermions cannot occupy the same state, so here at absolute zero the particles fill up the lowest available states up to an energy EF, the Fermi energy. For a Fermi gas, at absolute zero the energy per particle does *not* go to zero.