One option to try would be to change the login settings so that you are not automatically logged in when you start up to the computer. After you make this change, log out, log back in, toggle that display sleep setting on then back off and check the result.
Something else that might be worth a try...
First, I'm not sure what preferences, if any, will need to be reset after this. Also, I have not done this and do not know the result. As always, backup your stuff.
1. Go to the folder
./Library/Preferences/SystemConfiguration (not your Library folder but the one at the root level of your hard disk).
2. Drag the file named
com.apple.PowerManagement.plist to the trash. You will be prompted to enter your admin password when you do this.
3. Restart.
MacBook/2.0/1GB/CTO (white); PowerBook G4 12/1.33 Mac OS X (10.4.6) Airport Express, iPod mini, iPod nano