Martin,
I was using version 2011.1.413.35. I have upgraded to the latest version, and am now experiencing a different problem:
Here is the code for my masked text box:
In the prior version, this code was behaving as described above. In the new version, the control doesn't correctly display the empty message when the page loads, rather, it shows the mask "__:__ AM." The literals in the mask seem to be causing it to incorrectly deem the control as containing a value, thus displaying the mask rather than the empty message.
So I am not able to test if the new version correctly stops the issue I was having, as the control isn't correctly hiding on blur to begin with.
Any suggestions?