I tested a W7 64 system as far as I understand your problem description ...
Set Sleep to 1 minute, no problem sleeping or wakeup.
Set Sleep to 2 minutes, no problem sleeping or wakeup.
Set Sleep to 2 hours, waited 5-10 minutes, PC stayed awake (as it should), no problem.
Set Sleep to 1 minute, no problem sleeping or wakeup.
Set Sleep to 2 hours, no problem sleeping or wakeup.
This system has 5 startup programs
Avast AV (free), MBAM (paid), WinPatrol (free), EMET, Process Explorer.
I use HYBRID Sleep.
The OS was installed 4+ years ago.
So, for me there is nothing magical or mystical when setting the sleep timer to 2 hours ...
It works as it should, without any incantations or chants.
Normally I have auto sleep set to 30 minutes and turn off display set to 25 minutes.
For Patch Tuesday I change the auto sleep setting to 1 hour, so Windows can run any background maintenance it wants to.
If I'm doing something special that might take several hours, I set auto sleep to never.
As far as incantations and chants to fix this, maybe some other forum would be more helpful
Win 8.1 is a different story, if you want to discuss that ...