Just tested in and yea its not removing the immunity to sleep. I see the code to prevent the Sleep from being bootstrapped, on the race, but it looks like its maybe a timing issue.
I would advise reporting it as a bug
HERE and let LW fix it. Otherwise the thingid.raImmSleep is on the Elf Race itself and the Bootstrap Condition should be preventing itself from being added if the thingid.raElImmune is replaced on the hero.
My guess without spending a bunch of time testing is its a timing issue. The tag
AbReplace.raElImmune is getting set after First/500. You can do a new copy on the elf race. And under bootstraps look at the condition button for raImmSleep....