gvisnic,
I have a set like the OP posted installed on my awning. In my experience the IR receiver (tiny little black plastic blob at the end of the short cord on the small white box) is VERY fussy about positioning. As I recall (and I'm not at my RV) it's the rounded side of the blob that has the sensor, and it must be facing the remote. You can see the sensor imbedded in the plastic to be sure. Turned around? Doesn't work. Sideways? Get varied results and "confused" signals (wrong color lights etc.) Face-on? Works.
You could indeed have a bum controller and/or transmitter, but make sure the little IR antenna is positioned properly. I thought mine was bad at first until I figured it out.