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Yes, unfortunately this seems like it might become an issue on some devices. We are going to develop the seek/pause/longer cache support on our FFMpeg engine and will actually make the stable engine be the XiiaLive v2 stream engine. Than the Android (Beta) will become the seek support engine.
Currently the beta doesn't have the add custom URL but it will be added in one of the beta updates. Also, the official release of V3 will have this feature available.
There is currently and issue with Android 4.x in regards to streaming. When the screen is shutdown the network speed is slowed down and sometimes completely turned off.  This is most likely the issue.

Related Android bug:
Oops! Sorry, It just seemed like that was the issue... :P  Does this happen with all stations? Could you try an AAC station and also MPEG station to see which type is having issues? It might be worth reproducing the issue and than collecting the logs from your phone.  This will allow me to see what is happening internally.  To do that its simple:
Thanks for the details. This seems to be an issue with our AAC streaming. I initially thought this might be related to WiFi not sure why... :P  Have you tried using the Internal Stream engine? How about using XiiaLive Beta? There where some changes on the AAC stream engine that maybe work better?
There is currently and issue with Android 4.x in regards to streaming. When the screen is shutdown the network speed is slowed down and sometimes completely turned off.  This is most likely the issue.

Related Android bug:

Update 04/29/12:
Seems like there is a new WIFI locking API changes on Android that need to be made part of XiiaLive for the screen OFF issue. Will add this change to the next beta update to see if things are resolved.

This is a standard issue with online radio on wireless devices.  If you want to understand a bit more what the buffering settings do take a look at this post.

Also, we have created a new engine that automatically recovers from a lost connection.  It is in beta state but you can check it out by downloading XiiaLive Beta.
Can you check the baudrate of the stream right away after you unlock the screen? It should be visible on the player in portrait. If the baudrate is lower than the actual stream bitrate that would indicate a slowdown on the network connection.
There are some issues with our licensing checks for the past weeks for some reason.  We believe this might be because of the changes with the new Google Play Market.  We are already working for a new method that will hopefully end this issue once and for all! :)

The solution that seems to be working for everyone is the following:
1. Backup all your favorites and tags. "If you don't want to loose your tags and favorites."
2. Uninstall and install the app again from Google Play. "Don't worry you wont be charged twice"

To backup XiiaLive data:
Open XiiaLive and go to Settings->Backup & Restore.

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