In settings I unchecked "Spin down hard disks" on battery power but it does not
seem to have done anything.

hdparm -I /dev/sda shows:
    IDLE_IMMEDIATE with UNLOAD is enabled
    Advanced power management level: 127

Shouldn't one of these have changed?

Load_Cycle_Count in 'smartctl -d ata -a /dev/sda' shows disk is spinning down
(it is also audible).

Is the AC plugged when you check? Also, check if laptop-mode or other
tool doesn't interfere here.

Regards,

spins down. laptop-mode-tools is not installed.

The problem seems to be interaction with pm-utils: from
/var/log/pm-powersave.log I see that when I unplug AC pm-utils
immediately runs /usr/lib/pm-utils/power.d/95hdparm-apm, which sets
"APM_level = 127" on /dev/sda.

xfce4-power-manager depends on upower which depends on pm-utils, so
this isn't some unusual package interaction, these packages are always
going to be installed together.

Yeah well, there's not much we can do unfortunately. We need upower (not
pm-utils) and we can't really edit pm-utils files. It should be possible
to disable disk spin down in pm-utils manually.

The checkbox in xfpm is only about what xfpm does.

Regards,

Yes but how is the checkbox supposed to work? There's no point in xfpm
having the checkbox if it doesn't work. Is it possible for pm-utils to
co-exist with other power managers? How do other desktop power
managers override/control pm-utils? Should upower have the depend on
pm-utils removed, and then add a conflict between pm-utils and
xfce-power-manager?

Reported upstream at https://bugzilla.xfce.org/show_bug.cgi?id=10317