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An EQ mount is not supposed to rotate in azimuth except for the small corrections needed for polar alignment. So you have assembled it correctly from the sounds of it.
There are many videos on how to set it up but in a nutshell:
Get a compass and a straight edge
Find out your magnetic declination (its 12.4 degrees East for Newcastle)
Lay the straightedge on the ground and align it East-west using the compass. Take into account magnetic declination so true east is 90+declination or 102.4 degrees
Line up two legs of the tripod along the straight edge so the dowel is pointing South
Level the mount (not absolutely essential but it makes things easier)
Adjust the altitude of the mount to your latitude (32.9 deg south for Newcastle). The markings on the mount are often not very accurate so if you have an inclinometer use that. The angle of the mount from horizontal is the same as your latitude
Adjust the azimuth scews to be roughly symmetrical
That should get you near enough for visual use. Finer tuning is another set of lessons that require using the polar scope. But that is an exercise in masochism in the southern hemisphere.
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