As a matter of fact I had the same issue, either as described above or, when I checked the forced rewrite box, doubling the site title. And I'm using a woo theme which clearly states that it supports the third party plugins like WP SEO. I checked "use 3rd party SEO plugin" box that my theme provides.
How I solved the problem:
I UNchecked the box for "forced title rewrites"
I changed my header.php title
<title><?php wp_title(''); ?></title>
<title><?php woo_title(''); ?></title>
(if you are using a wootheme or maybe another theme that includes a lot of its own functions it may be something other than wp_title and checking the force rewrite box won't work)
then I used %%title%% - My Site Title
for POST title (you can just use %%title%% as well.
This fixed the weird bug of having the title of the first post I went to "stick" for all subsequent posts–it displays just the post title followed by a separator and the site title.
I think anything to do with the code in the theme was probably intentional rather than "bad."