@inciarco:
The code that evaluates the phrases is in nominate_topic_cron as you suspect. Seems like somehow your code sets the title to the PM message instead of the PM title. There is no code to evaluate phrases for the PM subject - it just simply retrieves it. Make sure you have this line of code before $pmdm->save();
Quote:
$pmdm->set('title', $nt_awardwinner_pm_subject);
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Looks like your problem is that your code might use $nt_awardwinner_pm instead in the above method call.
In regards to this mod's conflict with the Live Topics mod, I can't verify your solution since I don't use Live Topics, but after reading your post, it sounds like a possible solution.