They aren't, by any chance, typing in a space somewhere? Have you seen them do this, or have you yourself been able to do it? Since it can be picked from the list, I'd be suspicious that what the user *thinks* they are typing isn't what's in the list.

For example, it's hard for users to understand why

" There is a space at the beginning" and "There is a space at the beginning"

are not the same.