I have Ubuntu 10.10 and I am big fan of powder toy, but for some reason console doesn't open when I press `. I have powder toy 47.3, I tried other keyboard layouts, but only thing that worked was recompiling powdertoy with changed SDLK_BACKQUOTE to SDLK_SEMICOLON. (Interesting fact was that writing ` in sign or in creation name worked.)
I am guessing you have another application running that uses `. I know there is some terminal program that will open on `, and may have priority and stealing the key. The only other thing is your ` is not coming across in SDL as SDL_BACKQUOTE, there are other names for it.
Ok, I solved it, it looks like powder toy doesn't use actual keyboard layout but the prefered one, when I set QWERTY as default layout it works. You can lock thread.