For those of you who enjoy using the chat room, you'll be very pleased to hear that I have sorted some of the problems you are having. For starters, the timeout is not a fault in the software, this happens if you are in the chat room but inactive for two minutes. As for people being shown to be logged in but actually not, this was actually an oversight on my behalf, I have not implemented the landing page when you click logout therefore when you don't actually click logout chat room just maximised and you have no new way of leaving the chat room apart from closing the whole site. Anyway, that is now sorted and when you click logout you will be redirected back to the forum. Please remember you must click logout, if you don't click logout I suspect the chat room will think you are still in there.
Anyway, hope that's okay for you, I've tested it a little and it seems to be working okay