Laptop hibernates when lid closed and game playing?

Asus Laptop N56J running Windows 8.1. I want to run an external monitor as my only source of a screen for my laptop while it's at my desk.

Any time the lid of the laptop is closed AND a game is running (have tested steam games and independent from steam, like GW2), between 2-5 minutes the laptop hibernates. If the lid is up, there is no issue.

ALL power options are set to avoid sleep and hibernation with and without the power cord. The screen is suppose to turn off but not sleep or hibernate.

I have set all screen resolution settings to the optimal settings for the three separate monitors I have tried. It happens as long as the lid is closed. The main screen is the external monitor and laptop screen is disabled.

The laptop does NOT get hot. It doesn't seem to be an overheating issue.

It's NOT shutting down or sleeping. I need to use the power button to turn it back on but when I do, all programs, including my game, are right where I left them.

Even though I don't think it's anything to do with the monitors itself, I have tried connecting external monitor via HDMI, VGA, and a DVI to HDMI cable.

Latest drivers for laptop were installed to try and fix the issue. It did not.

The only thing that has changed this issue at all is messing with the ATK hotkey packages:

-Deleting ATK Hotkey package. This solved the hibernation issue BUT instead of it hibernating after the lid was closed and the game is playing, the entire laptop restarts instead.

-Installing the most up-to-date ATK hotpackage. Back to hibernation issue.

-Tried Asus power manager. No help.