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It seems to me that the only advantage in having the device in standby is that it is insensitive to button press: this way if you (close the cover and) transport it, you don't risk to mess up what you were reading.
On the power consumption side, I don't think there is a relevant difference, if any at all! In fact, when the device is on and you simply don't press anything, it looks like it doesn't uses any power. For example, it doesn't even update the clock.
If my considerations (born from my user experience) are right, then setting power management to other than "Off" is useless or even deleterious, given the bug pointed out by Mono.
All in all, set power management to "Off" and simply switch it to standby only when you need to carry it, otherwise just leave it as it is.
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