Also you need a decoupling capacitor across the power connections of that chip for it to work correctly.
So, what value are you using on the Iset resistor (not shown there) and reassure us you are not powering an Arduino from "Vin" or the barrel jack?Also explain what you mean by "the display shuts down"?Provide photos - in good light and focus - of your arrangement.
But would it be a problem if I actually use a battery through the barrel?
I read some where that i should use a 10k Resistor. I changed it to 20k like it should be and works fine now
Yes.1) That is a criminal waste of battery power burning up its power.2) If it is a 9V square battery then throw it away it is useless for powering much as they don't last very long.3) The current will be too high for the internal regulator and it will overheat and at best shut down at worst burn out.By doing that you are reducing the current you are trying to use so your original problem was an inadequate power supply. Running it off the Arduino's 5V pin is a no go.
The ground of the battery still needs to be connected to ground of the Arduino. But a 2s battery has a voltage of 7.5V so it is too high to connect directly to the chip. It needs dropping down to 5V, look for a buck converter to do this for maximum battery life.
ut would that work?
No idea because I don't know what a PDB is, therefore I don't know if the two outputs from it have a common ground or are isolated. The display's power and the Arduino's power need to share a common ground, here is why:-http://www.thebox.myzen.co.uk/Tutorial/Power_Supplies.htmlWhy not drive the Arduino and display off the same supply? I think you are getting mixed up with powering the display from the Arduino's 5V pin, with powering the Arduino with an external supply through its 5V pin.