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The only know deal with the Kobo WiFi is that a short press does not send it to sleep when you are using sideloaded books. It happens that you can go to sleep from the I'm Reading menu.
If you can try a reader at a bricks and mortar store, you can see how it is supposed to work and see if it is different from the way your reader is working. As it it is a new reader, you may want to do an exchange.
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