I'm wondering if this is a known bug or not, before creating an issue on the GitHub page for BOINC.

My environment:
Windows Server 2008 R2 x64
Hardware: 2x 6c/12t Xeon (24t total)
60GB RAM
BOINC 7.16.7

Using local computing preferences for this machine only, set to 50% of CPU threads use, 100% of CPU time, and set to suspend if non-BOINC cpu usage is above 30%.

This machine is used for multithreaded compilation which bumps CPU usage outside of BOINC to 95% when active, and BOINC should suspend, but it doesn't. Even if fully loaded, BOINC continues to compute which is not doing what I'm telling it to do ;-)

Perhaps similar to https://boinc.berkeley.edu/forum_thread.php?id=13843? But this is on Windows.

Can you check what Activity is set to? BOINC Manager, view, advanced view, activity menu.

Should be set to Run based on preferences. If set to Run always, it'll ignore preferences.

---

It's set to run based on preferences, of course.

I'm assuming this is a bug at this point since it seems wrong and there doesn't seem to be a previous issue on github for it, so I'll open a new one.

I just tested it on my system with setting the value to 7%, then ran a Kaspersky database update (which uses 8% CPU).

20/07/2020 11:55:10 | | Reading preferences override file
20/07/2020 11:55:10 | | suspend work if non-BOINC CPU load exceeds 7%
20/07/2020 11:55:10 | | Suspending computation - CPU is busy
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting JHR_bd5_14318_n_0000100004_0000020_0_fragments_fold_SAVE_ALL_OUT_990551_24_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting JHR_bd5_05111_c_0000200008_0000008_0_fragments_fold_SAVE_ALL_OUT_963479_24_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting JHR_b2_02877_c_full_17_0000100002_0000014_1_fragments_fold_SAVE_ALL_OUT_991321_24_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting JHR_bd4_01971_c_0000100004_0000019_0_fragments_fold_SAVE_ALL_OUT_994204_24_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting b4k_8814_fold_SAVE_ALL_OUT_956605_919_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting b4k_5283_fold_SAVE_ALL_OUT_958064_919_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting b4k_8563_fold_SAVE_ALL_OUT_958198_919_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting b4k_8205_fold_SAVE_ALL_OUT_958183_919_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting b3x_7312_fold_SAVE_ALL_OUT_957241_919_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting b3x_1594_fold_SAVE_ALL_OUT_956731_919_0 (left in memory)
20/07/2020 11:55:10 | Rosetta@home | [cpu_sched] Preempting tgfbR1_3_SAVE_ALL_OUT_IGNORE_THE_REST_4gt4bw5q_986472_1_0 (left in memory)

So works for me.
This is on Windows 10 with a single CPU (Ryzen 3900X running single threaded)