Your people should wake up the minute they are hit. This was a major bug in Baldur's Gate where people who were sleeping would stay asleep, even as others began to pound them with clubs. A nasty thing, that.
About the Bard/Invisibility thing; What if your mage cast invisibility on the bard while he was singing?
Cheers,
Moiraine Sedai
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~The wheel weaves as the wheel wills~
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