The data compete is stating is the number times people searched Twittered for Sleep.fm and not the amount of Twitters. We do have a somewhat steady stream of people talking about us, but compete's data is not showing the most popular Twitter topic rather most popular searches. Sleep.fm would surely not show up in that report, more so Obama, iPhone and other pop culture attention getters.
Traffic is also http://siteanalytics.compete.com/sleep.fm/?metric=uv only at 5k uniques. If the search volume was what they indicated, the traffic would be decently higher (how much higher i dont know).