The 'sclogout' menu item should be created as an external link type of menu item. The link itself should just be 'sclogout'.
However, that feature *only* works with the SCLogin module when you are showing it to logged in users and have chosen to show a "User Account Menu" in the SCLogin settings. Joomla itself doesn't have a direct-link logout menu item, unfortunately, which is why we implemented it in our module. If you aren't using our module for logged in users, you won't be able to take advantage of that feature.
We use the direct link logout button on this site. The My Account menu above is a standard Joomla menu being shown in the SCLogin module. Not sure what you're trying to accomplish, but you should be able to make our SCLogin menu integrate well into your site.. hopefully
I hope that helps explain,
Alex