Note that running the obfuscator will rename everything to hide it's purpose. See here, http://msdn.microsoft.com/en-US/library/ms227212(v=vs.80).aspx.
My guess is that your <myapp.My.Settings>
would have to be changed to the obfuscated name. I'm not sure how you would determine that however.
Edit: It looks like dotfuscator outputs a map.xml file that specifies all the stuff that was renamed. You should be able to lookup myapp
and see what it got renamed to, then update the .config file.