Ive just noticed the auto-brightness setting does sweet fa, sensor covered or not.
This is showing both hw & sw symptoms, hoping its just sw of course!
We need to bombard HTC with emails etc...
This is the kind of issue that makes me consider a reputable seller for this sort of thing.
How I imagine things playing out if you take a problem like this to the people you bought it off:
CPW/P4U: They'll tell you to get lost and point you at HTC (whether they're supposed to or not they will try and get rid of you).
Amazon/Play/Direct from a carrier: Will swap the phone no questions asked, quite possibly for one with the same problem. Repeat again and again.
Clove/Expansys: Will probably have spoken to someone in HTC who might know the truth and will either replace the phone if necessary, with a tested replacement or let you know about the software side of things.