THE 46TH ANNUAL EMMY AWARDS : THE SCENE: Backstage Spin : Big Wins for ‘Fences’ Leave ‘NYPD’ Blue : CBS show gets several key awards, including best drama, but best actor goes to Franz.

The small town beat up on the Big Apple.

Despite its record-setting 26 nominations and more controversy and publicity than you could shake a nightstick at, ABC’s gritty police drama “NYPD Blue” had much of its thunder stolen at the 46th annual nighttime Emmy Awards on Sunday by “Picket Fences,” the quirky drama about the fictional town of Rome, Wis. The CBS entry was named best drama series and also won for best supporting actress and actor.

“We thought we had a chance,” “Picket Fences” creator and executive producer David E. Kelley told reporters backstage at the Pasadena Civic Auditorium. “We knew we had good competition. If we were to believe everything we read and heard, we would have been sensible to predict ‘NYPD Blue.’ But the only thing we knew going in was that all the episodes had to be screened and looked at, and we knew if the panel sat in the room and watched ‘NYPD Blue’ and ‘Picket Fences,’ we would do well.”

In winning the best drama award, Kelley beat out his former boss, “NYPD Blue” co-creator Steven Bochco, who also co-created the acclaimed “L.A. Law,” giving Kelley his start as a television writer and then turning the show over to him.

It was the second year in a row that “Picket Fences” scored a surprise victory in the drama series category despite lackluster ratings.

“We kind of hoped it would give us a big kick-start last season and our ratings would improve,” Kelley said. “We would hope that will be compounded this year. With two Emmys, we hope people will stay home Friday nights and watch us. It’s a difficult time slot.”

“NYPD Blue” still came out the biggest winner of the night with six Emmys, and probably the most eagerly applauded award was Dennis Franz winning as best actor in a drama series for his coarse police detective.

Following the show, Franz walked into the press room clutching his Emmy and said, “What a shocker. Big surprise, huh?”

Franz’s co-star, David Caruso, who is leaving “NYPD Blue” in a controversial salary dispute, had been the favorite. “I thought David would win,” Franz said. “I thought the ball was in his court.”

Referring to his show’s loss to “Picket Fences,” the actor said, “This is a bittersweet night. There were so many nominations, and there were certain ones we thought were shoo-ins. The show, we thought, was pretty much a lock. We expected to win that. But I told (“Picket Fences” co-star) Kathy Baker that, if we were going to lose, ‘We would rather lose to your show.’ It is a disappointment, though.”

Franz would not speculate on whether Caruso’s decision to leave the series--made shortly before voting on the Emmys took place--might have had a backlash effect with the judges. “That’s hard to say,” he said.

Franz has been supportive of Caruso with the news media, but he did not thank his co-star in his onstage acceptance speech. That was an oversight, he said afterward.

“I forgot to thank the entire cast, if you want to know the truth,” he explained. “I’ll show you the (note) card. (Caruso’s name) was on the card. I sort of skipped over that one, and I feel bad about that.”

Former “L.A. Law” star Jimmy Smits has been cast to replace Caruso after four episodes this season. When Ann Biderman stepped backstage after picking up an Emmy for writing an episode of “NYPD Blue,” she was asked if she was writing the script introducing Smits and, if not, whether she could reveal how he will be introduced.

“I’m not, and no, I can’t,” she responded coyly.

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“Frasier” star Kelsey Grammer spoke for the cast and crew of the show, which won as best comedy series, in saying he was pleased: “It’s flattering. Sometimes it feels like it’s deserved. You work a lifetime trying to get recognition.”

Whether the Emmys for him and the show will result in greater expectations before the comedy’s much-touted move to Tuesday nights, where it is pitted against ABC’s “Home Improvement,” the No. 1 show on TV, Grammer said, “Well, it couldn’t hurt. I’m sure NBC will take every opportunity it can to plaster the news all over. This will keep a lot of people at the network busy. But I think we would hold up in whatever time slot we were in.”

Peter Casey, one of “Frasier’s” executive producers, commented on the move when he came backstage to accept his Emmy for outstanding writing in a comedy series. “We don’t really have a whole lot to say in the matter,” he said. “So we’re just going to go in with the best show we can produce, and do the things that have made it a pretty popular series to this point.”

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Kirstie Alley, who beat out the favorite, Bette Midler, as best actress in a miniseries or movie for her role in the CBS film “David’s Mother,” had to live down some notoriety when she stepped backstage. A reporter asked what her husband would say now, referring to the fact that when Alley won an Emmy in 1991 for her role on “Cheers,” she joked about her husband, actor Parker Stevenson, giving her “the big one.”

“He will probably say thank you, and to keep my mouth shut,” she said with a laugh. “He’s never been quite the same. He’s never been looked at the same, I’ll tell you that.”

Anyone hoping for Alley to turn up on “Frasier”--a “Cheers” spinoff--as Rebecca, the character she played on “Cheers,” may be in for a long wait, she advised.

“I think at some point you have to pretend like you have another job,” said Alley, who is getting ready to star in a movie for horror director John Carpenter. “Those women on the show are so wonderful--they really are--and fresh. We’re not,” she said, referring to the former “Cheers” barflies.

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Aaron Spelling said his award for producing “And the Band Played On” was the culmination of 4 1/2 years of difficult work.

When asked why he took on the project when he is known for lighter fare, such as “Beverly Hills, 90210” and “Melrose Place,” he said, “There were too many friends that were dying, too many friends who had died of AIDS, having a young daughter and son,” and to get out the truth that “AIDS is not a homophobic disease. That is stupid.”

He added, “The band is playing on, and Washington hasn’t done a damn thing about it.”

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Dennis Miller didn’t seem to be in a mood to take any shots at Tribune Entertainment or those who canceled his syndicated talk show two years ago. And unlike his caustic demeanor on HBO’s “Dennis Miller Live,” which won for best writing for a variety or music program, Miller was relatively subdued.

“I don’t want to get into any (stuff) about whether I feel vindicated or not,” he said backstage, flanked by his fellow writers, who shared the award with him. “You do feel screwed for a while. But it’s nice to have a job.”

He added that his show will return on HBO this fall, and the big change is “I got rid of all my body hair” while it was on hiatus.

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Candice Bergen was genuinely flustered backstage after winning her fourth Emmy for best actress in a comedy series for “Murphy Brown.” She was listing off all the people she didn’t thank--CBS, the producers, her co-stars.

“I usually prepare something in case I win, but I was sure it was going to be Helen Hunt for ‘Mad About You,’ ” Bergen said.

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David Letterman, whose late-night show on CBS was named best comedy, variety or music series, had kind words for Madonna, who caused a ruckus on his program with her coarse language. They appeared together at the MTV Video Music Awards last Thursday.

“She called me on Thursday and asked if I would go with her to the awards,” Letterman said. “She was very nice and very pleasant about it and, other than the other 98.9% of the show, I really enjoyed myself.”

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“Manchurian Candidate” director John Frankenheimer had never won an Emmy, despite being nominated six years in a row from 1955 to 1960. He revived his directing career this year on cable television, and he finally broke through for a golden statuette with the HBO prison drama “Against the Wall,” about the Attica prison uprising.

“It’s such a great feeling,” he said. But he noted that after directing for 40 years, “It has never gotten easier. It’s harder now because I don’t want to repeat myself.”

Frankenheimer’s latest film, “The Burning Season,” starring Raul Julia as murdered Brazilian activist Chico Mendes, premieres Saturday on HBO.

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Michael Richards, who scored a best supporting actor award for “Seinfeld,” said he felt strange beating co-star Jason Alexander for the second year in a row: “I think he should have one of these. Everyone on the show should have one of these.”

As for his silent acceptance speech, he explained, “I was blown. I didn’t think I would win. The clock was going by so quickly, and there were so many people to thank.”

* MAIN NEWS STORY: A1

Times staff writer Susan King contributed to this report.