FINALLY, Here is my fix...
in System Preferences -> Security & Privacy
Turn on Disable automatic login
Turn off Allow your Apple Watch to unlock your mac
in System Preferences -> Bluetooth
Turn off Bluetooth
in System Preferences -> Network
Turn off WiFi
Shutdown your mac, and DISCONNECT ALL DEVICES:
USB Drives, Dongles etc,
Thunderbolt,
Video, etc
Disconnect the power for 10-15 seconds.
Plug just the power in to your mac.
Restart your mac with Command-Option-P-R (PRAM Zap)
After login, go into:
in System Preferences -> Network
Create a New Location (Home, Home2, etc)
In the left column, Delete all but WiFi, (Bluetooth PAN, etc,
this is a new location all your OLD settings should be in [Automatic Location])
Turn on WiFi, you should pick up setting, do to your iCloud settings, if not select your WiFi.
Go into:
in System Preferences -> Bluetooth
Turn on Bluetooth
in System Preferences -> Security & Privacy
Leave on Disable automatic login
Turn ON Allow your Apple Watch to unlock your mac
wait for spinner to stop, and quit Sys Pref
Sleep your machine with power button, wait 60 seconds, and wake with keyboard and unlock with watch
wait 2 minutes
repeat the sleep test again,
you should be good to go!
And I guess don't plug any USB devices in for an extended time at this point in macOS Sierra, and if you restart you might have to unplug them... (Thanks Apple, and macOS Sierra)
Over and Out...