There's nothing wrong (that I can see) with your settings.
What you are referring to (people being taken to the last slide they finished on when resuming) is called LMS Bookmarking. Have you determined that YOUR PARTICULAR LMS actually supports this feature? If it doesn't, then nothing you do with your Captivate course will change that.
One thing you should ALWAYS do when experiencing issues with a course in an LMS is to try the same course SCORM package on SCORM Cloud online LMS to see if the issue is shown there as well. I recommend you check on SCORM Cloud to see if it bookmarks OK. If it does, go back to your LMS vendor and complain.
If you click the Advanced button on the Quiz Settings screen and look at your LMS Customization options, does it show Never Send Resume Data as being unchecked?
How many slides are in this project? If there are a lot, have you tried hiding half the slides and then testing to see if your bookmarking works then? In theory this should reduce the amount of resume data and pull it back under the limit (if in fact the issue is with the size of the resume data at all).