Sounds to me like your setup was perfect.
I cannot think of any reason it could be that far out, providing you aligned on the first alignment star correctly. So if you are sure you pointed to Fomalhaut, it sounds like a faulty unit.
So to confirm, you move the scope to Fomalhaut, which is roughly ESE (114* at 19:45).
And select Altair as second.
And it slews to where?
It should move about 63* anti-clockwise (to NE 51*)
You said it was about 120* out. So did it move 180* anti-clockwise, or 60* the wrong way (clockwise).
Looking at your sky for last night (using Stellarium), there are a couple of stars that you may have mistaken for Fomalhaut. (like Arcturus or even Canopus) that may have given you that sort of result.
Just saying....!
otherwise the unit must be crook.
