When using a token for a taxonomy term field that has term autocreation enabled, the token doesn't work. This is because the term does not yet exist when the title is generated during hook_node_submit() (line 47 of auto_nodetitle.module). If, instead, the title was generated in a hook_node_presave() (line 57 of auto_nodetitle.module), as would happen if the hook_node_submit() wasn't called, the terms would be available. Of course, this would cause the preview to not have the title set.

Right now, I'm solving this using a custom hook_node_presave() which checks to see if the specific term failed to get substituted, and, if so, regenerating the title.

 * Implements hook_node_presave().
function module_node_presave($node) {
  // New taxonomy terms aren't available to auto_nodetitle, so we have to
  // manually rerun the node title creation after the term is created.
  if ($node->type == 'grant_report') {
    if (strpos($node->title, '[TERM-TOKEN]') !== FALSE) {

Not sure the best way to deal with this in auto_nodetitle, though. Running the title generation twice in general seems a poor solution, and eliminating the preview is unacceptable.