I do not see that option to disable in light and power settings.
thanks for the reply
michael
Sorry, I didn't notice your model (Zaurus 5000d). This is not a clamshell, so no "suspend on closing the hinge"...
But, I noticed you are running OZ3.5.3. I had a similar problem also with the 3.5.3, which was solved (except that above problem) after flashing to OZ3.5.4.
As was also suggested by Hrw.
YoG.
P.S.
Another place to look for answers will be the IRC:
server: irc.freenode.net
channel: openzaurus