I've restarted several times, but no dice. Meanwhile it appears that the Palm update has also updated the classic app to 1.1.05

. (Go to Classic-Help to see). And under Classic--Options there are now settings for Emulation mode, Sound, Turbo, and Alarm!
I wonder if a pre-release version of Classic got wrapped up into the Palm update? I can't imagine that this was intentional - that a Palm OS update would include updates for a third-party application.
I've a sneaking suspicion that if I blow away my Classic environment and start over that it would fix things. But I'm going to try to get in as root and back it up first later tonight.