I would use sbmerge to modify the project instead of trying to find the setting manually.
1. Make sure you delete the sandbox for the application, we want a clean sandbox
2. Run the application and activate the setting you want to change
3. Close the app.
4. Run sbmerge.exe Print > c:\registry.txt and investigate this file. It will show you if there is a lot of rubbish. If there is you might want to manually copy paste the correct setting into the registry files of your project.
5. If the output is fairly clean run sbmerge.exe Apply, this will merge all setting in your sandbox into the project. Rebuild and you should have your setting built into the package. Please make a copy of your project prior this exercise since you cannot revert sbmerge.

More sbmerge info: http://blogs.vmware.com/thinapp/2009/10/how-to-maintain-a-thinapp-package.html

It could still be the case that it is something strange with this setting and we cannot virtualize it but above will show if that is the case..