NOTICE: Please save yourself some time and refer to the accepted answer, no need to read all the quesiton.
You may read the rest of the question and the answer I provided for an alternative (although less sophisticated) method.
Also, you may want to take advantage of the fix for the background glitch in Android 2.X, by adding the related piece of code to your preference activity class.
Background
Being a newbie to Android coding, but somewhat experienced in other programming languages/frameworks, I was expecting my walk to Android application coding would be a rather pleasant one. It was so, until I stumbled upon this problem:
Eclipse wizard for Android projects suggested I could reach a 95% of devices if I set my minimum API to 8 (Android 2.2). I didn't need to do any fancy things with my app anyways, so I thought, "sure, why not?". Everything was okay, except occasionally I'd find several methods/classes that were deprecated in most recent API versions, and so I had to devise ways to keep using the old ways for old devices, and try to use as much as possible the new ways for newer Android versions. This is one such occasion.
After using the Eclipse wizard for creating a preference activity, I realized that the Eclipse precompiler/parser/checker(or whatever it's called) Lint, would complain about not being able to use the new ways of creating/managing preferences in older API versions. So I thought, "all right, screw the new ways. Let's do it old way and since new API versions are supposed to be backward-compatible, it should be okay", but it wasn't. Old way used methods/classes that are marked as deprecated; which, to me, means, even though they'd still work in current API, they'd stop working at some point in future releases.
So I started searching for the right way to do this, and finally hit this page: android compatibility android-preferences backwards-compatibility