Correct, this has nothing to do with IR, it is signalled through the sync pins on the VGA connector. The device you create is a GSD one, I set the Comm Method to unknown... don't think this really matters that much. You need to make sure the Controlled By is the MD device that the monitor is connected to and the room/entertainment areas are correct. This in addition to ensuring there is a video pipe from the MD to the VGA Monitor device you are creating. Check the device log when it starts to make sure it is happy with the Ruby and starts up correctly. And make sure that the devices is "Registered: Yes" once started. Then you can either use the power menu as Krys mentions, or simply wait - after the timeout, LMCE will automatically trigger the Off command and send it down the audio and video pipes in that entertainment area, which ends up hitting your new devices, which interprets this command and executes the Ruby snippet cutting off the screen...
The only time I have seen it no reliable was after a scheduled event I had running each morning playing music. The screen was off, the event would trigger and the screen would come on. I would kill the music after a minute or so, and the screen would never turn off again. Btw, there is an annoying factor - unfortunately, LMCE considers even mouse movement to be a wake up trigger. This makes it very difficult to turn the power off with a gryo remote, and moderately difficult with a mouse. Clearly there is no reason for mouse movement to be considered "activity" this should be limited to actual button presses, then the mechanism would be complete.... have yet to log a bug ticket for this...