This scenario indicates that the scholarship is no longer applicable to the "tuition". (The tuition gives you the tax benefit, while the room and board does not apply to qualified educational deductions.)

Thanks for the reply, and that is what I thought should happen, but Turbo Tax seems to be working just the opposite as it should. When the scholarship is only for tuition, I get no change to my refund amount, but if I indicate that some of it went to room & board, my refund grows by thousands of dollars. It seems to be calculating the info backwards. Thanks.