If you paid by credit card, contact your card provider (usually your bank). File a "charge-back" request based on merchandise not being as described and failure to provide contracted services. The credit card company will withdraw the money from the alarm company's bank account and return it to you. This will cause the alarm company to completely change their service priorities.
Next, regardless what they do for you -- good or bad
-- at this point, write a letter to the local newspaper and television station consumer editors. Just write one letter and send copies to every station and every paper within a 100-mile radius. Describe accurately and concisely what they screwed up. Include a photo of the contact interfering with the window blind. Explain that they connected the transformer to a *switched outlet* which is specifically prohibited by the manufacturer's instructions and the electrical code (they have to be installed according to the mfrs instruction manual) and how this makes the alarm system go into "trouble" mode if you turn the light off.
Document every conversation you have with these scoundrels. Keep copies of all correspondence.
Also, contact your state Consumer Protection agency and ask to speak to someone in the alarm licensing office. Explain what has been done to you and that the alarm company has cheated you by refusing to provide what you paid for -- a properly working alarm system. Ask for an official complaint form. Include a copy of your complaint plus any response you get in your letters to the media.
All this might seem like overkill to some but it's important to understand that the company has cheated this customer. Now they are refusing to honor the warranty (they installed the transformer wrong) even though he's paying for warranty service. That and the poor quality workmanship (installing sensors in such a way that the gentleman can't even close his blinds) is indicative of a bad alarm company.
If this was the first time we'd seen such horror stories about that company perhaps I'd have suggested a more friendly approach. Unfortunately, there us a long history of customer abuse and shoddy workmanship from P1 dealers. Nothing short of a "shock and awe" (apologies to the Shrub) campaign is appropriate.