That sounds strange Steve. Yes, you must use pencils/pens or something with a fine enough point to fit inside the dimples (not over them) so the bird can tip back and forth freely. How much was the CG off? It doesn't take much to significantly alter the handling of the Alula. If it's flying well on straight glide tests it should fly properly when you toss it up.
Two things come to mind. Have you double-checked your throws? Your elevator throw is especially important. You won't believe how drastically excessive elevator throw will foul your experience. Be sure you have the low rate set to the specs in the manual which is +3 / -3mm. Low rate aileron is +8 / -8mm While you're at it you might pay close attention to the flex in your elevons. Are they moving up and down uniformly or twisting so the inner part of the elevon has more travel than the tip. If they are not moving uniformly you may have to remove the control rod and repeatedly flex the elevon up and down to loosen the arcel hinge. Some Alulites have very lightly sanding the inner portion of the hinge to relive a bit of tension.
If you are still having problems after all of this I'm thinking you might have some sort of mixing issue in your radio. Patiently double-check all of your radio settings to be sure something isn't configured or tweaked in the wrong direction. Keep your radio settings simple until you get the hang of the Alula in "basic" mode. For a reference point, search through both Alula threads to see how people have setup their optic 6 or maybe someone can post a nice starting point.
If you have a sloper friend have him/her come out with you. Sometimes a buddy will think of something obvious that's been going over your head (no pun intended). I know this happens with me and my friends all the time. Teamwork!
One more thing just popped into my head. This is a long shot but I've seen it happen a couple times on Weasels, not sure if anyone has done it on the Alula. Are your servos installed backwards? The servo arm gear should be closer to the trailing edge than the leading edge (see pics in the manual). I'm not sure but if they were oriented improperly it may create some sort of undesirable differential.
If you're flying in the presence of wind be sure to launch nose into the wind.
Ok, I'm out of ideas for now...
Best of luck!