Lock screen turns off despite Always On setting

Extracted from the Apple Article Keep the iPhone display on longer: "The display automatically turns off when iPhone is either face down or obstructed from view, not near a paired Apple Watch, when a CarPlay session begins, while Continuity Camera is in use, while Low Power Mode is on, while Sleep Focus is on, or at your usual bedtime."

My recommendation would be to:

1. If the issue persists, you can try resetting all settings on your iPhone. This will not erase your data but will reset all personalized settings to their default values. Go to Settings > General > Transfer & Reset > Reset > Reset All Settings and confirm the action. Note that you will need to reconfigure your settings afterward. All settings—including network settings, the keyboard dictionary, the Home screen layout, location settings, privacy settings, and Apple Pay cards—are removed or reset to their defaults. No data or media are deleted.
   1. Reset All Settings: Return iPhone settings to their defaults - Apple Support:- Return iPhone settings to their defaults
   2. You can return settings to their defaults without erasing your content.
   3. If you want to save your settings, back up your iPhone before returning them to their defaults. For example, if you’re trying to solve a problem but returning settings to their defaults doesn’t help, you might want to restore your previous settings from a backup.
   4. 
2. Make sure you have the latest updates installed.
   1. Update Over-the-Air (OTA) —> Update your iPhone or iPad - Apple Support (IN)
   2. Update using iTunes/Finder —> Update your iPhone, iPad, or iPod touch - Apple Support (IN)

If none of the above steps resolve the issue, it is recommended to reach out to Apple Support or visit an authorized service center for further assistance. They can provide specific guidance based on your device model and iOS version.