The system is set to run the heat pump until it gets 25 outside. I have the temp drop to 67 after 11pm, and raise to 71 from 6-8am then drop to 67 until 5pm. Every time a new heating cycle starts the IAQ keeps defaulting to Aux Heat (propane furnace) and the temp outside is 40 deg +

I've had my installer back out and he adjusted some settings, but when I got home today, it was back on propane. He said he was going to contact honeywell but I am guessing its a bad IAQ. At first, I could turn the heat off and back on and the heat pump would turn on, but go back to propane on next heating cycle. It will run until the next sleep mode, then next morning on wake, back on Aux heat.

Does anyone have any suggestions? The settings are set that Heat pump is primary, Furnace is Aux. Aux heat runs at 25 or below. The 2deg drop in room temp to run only aux heat is disabled. Setting to run heat pump for a certian amount of time and if it doesn't reach desired temp is disabled.

This is very frustrating as I would like to save on propane after spending as much as I did on the install...

It may also be that the stat is still learning how to recover from setback. I think it takes a few days.

set your IAQ with these parameters and see what happens
172 system type = 2
200 backup heat (aux) = 1
210 fuel kit option = 0
342 Outdoor Temp sensor = 1 (must have sensor)
345 dual fuel hp control = 2 for a 2F droop with aux lockout
350 balance pnt lockout = 25 (must have out door temp sensor)
360 Aux heat lockout you can set this at 50 or 40 so the propane won't come on before it reaches these temps.

this will create the 2 degree droop for the heatpump and furnace between 50/40F and 25F.

If 345 says no backup, then you got me stumped. Never seen any problems with the logic in these.