Auto-Brightness works fine for me, you just have to know how it works. (I'm not saying you don't know how it works, but you may be overlooking something)
It will get brighter while using it, but it won't get darker. You have to put it in sleep, then wake it up for it to turn down.
Make sure when you're waking it, the light from the screen isn't reflecting on anything. When you have it on the lock screen, it will display it at the highest brightness that you're setting allows. If this gets reflected on something, and the phone sees it, it could interpret it as a lighter setting than you're in, and will turn the brightness up higher.
Also, even if you're in a completely dark room, if the brightness is set to full, it won't go down to the lowest setting.