This issue is caused by the keyboard driver. Disable the keyboard driver and Pocket Tunes will be able to blank the screen.
One of our customers discovered that TealScript was causing a problem. If you have TealScript installed, try unchecking "Enable Globally", that should allow the screen to turn off. We are contacting TealPoint to see if there is something they can do to stop TealScript from interfering with the screen turn off.
Also, check your settings in the Background preferences screen to be sure you have enabled "turn off screen while playing after xxx seconds" and "power button turns off screen". Check or uncheck the "unless the palm is in the cradle" as you prefer, but realize that it won't turn off in the cradle if you select this. Of course you also must be playing music for this function to operate properly. If Pocket Tunes isn't "working" it can't blank the screen.