Our PTO decided to stay out of the scholarship business (not a big deal at the elementary level, but we do have some tutoring where we were considering it). If you think you might get into it, then you really ought to fill Form 1023 out correctly, or else you'll probably need to file some amended report to the IRS later.
I think the IRS just wants to see a good policy in place to prevent conflict of interest: ie, that the officers' kids don't get automatic scholarships, or donors who give money to the PTO (tax-deductible) and have it funneled right to their kids' tuition. If you haven't thought about these potential issues, it's probably a good idea to do so.
2 years ago I helped our elementary school file for 501(c)3 status - and we got it thanks to the help of these boards and the PTOToday Startup Guide. Well, now I'm doing it again for the high school - it's much easier the second time around.
The only problem I've run into is on page 8, Part VIII question 22: Do you or will you provide scholarships to individuals? If "Yes", complete Schedule H. Our group is in the process of offering a scholarship to a graduating senior ($200) for the first time but nothing has been done about it yet. Should we just scrap the scholarship idea altogether? Answer yes and then fill in Schedule H (and is there help for filling in this form)? Or since we haven't done anything about it yet, just answer "No" since technically we don't currently offer a scholarship?
