Unfortunately I can't help with the solution (though I am taking notes on all the suggestions!), but I can say I had a similar experience with the re-issued Barrel Loader when I bought it.
I never was able to get it to work (same general results as you describe), so I ended up putting it back in the box for a project another day.
You are not alone with this one. One of my few complaints out of all of the re-issued Post War classic accessories. Most of my other items worked flawlessly, or at least very well.
-Dave