Okay...I think I actually found the root of the problem. What we would like to do, and I'm not sure if this is what was intended by the plugin designer, is for the categories we're setting as pages to neither be archive or category page types. Essentially what I needed to do was add these two lines in a few places in the plugin's functions.php file:
$GLOBALS['wp_query']->is_category = false;
$GLOBALS['wp_query']->is_archive = false;
Here's a copy of my functions.php file:
http://dl.dropbox.com/u/2953302/functions.php
Just put this in wp-content/plugins/pages-posts. I didn't have much time to make this look clean, so I just simply copied and pasted those two lines above in all three cases of this one if-statement.
With this change, you can change that line in archive.php back to the_excerpt from the_content...
Let me know if you have any questions. Hopefully the plugin designer sees this and gives some input.