Hi Ian,
Does this occur in the Corona widget demo on your device(s)? I just tested it on iPhone 5 and it works fine… releasing outside the screen lets the picker scroll to the value, and that value highlights.
Please run a few tests on this project to confirm whether it’s a picker wheel issue or an issue with your code:
https://github.com/coronalabs/samples-coronasdk/tree/master/Interface/WidgetDemo
(this is the same sample that’s located in your local Corona SDK application folder, so you can test however is most convenient).
Brent