I was looking for a plugin to create a smart location form field which has a suggested autocomplete. I was unable to find anything suitable (Google Geocode is too unreliable
If the problem is related to the highlighting you might want to check the success section of your ajax call and make sure that you are un-highlighting in the right moment. Because the section is always changing it might glitch at one point given the nature of bringing back lots of info and altering dynamically
hope this helps!
ps. autocomplete jQuery will autocomplete anything it feeds from