I have a desktop running kubuntu 11.10 that is using the netbook desktop layout due to a 800x600 display that is attached.

After 15 minutes, the video output automatically stops and my screen goes blank. When I move my mouse or press a key, then the display comes back on. I have checked the power management settings and the screensaver settings, and neither of these two things seems to be the problem. How can I turn off automatic the video output shutdown, or at least lengthen the amount of time before this occurs? This only occurs when I am running in the netbook desktop workspace setting.

Sounds like a bug, look if it wasn't reported on launchpad already.

assuming it's the screen saver and that somehow a bug is enabling it even though you've disabled it you can try WiggleMouse http://wigglemouse.sourceforge.net/

you should also try as a different user to determine if its a bug or possibly a corrupt config file in your settings