Encoder clearly isn't working. Its indicating forward and reverse velocity at virtually the same time. This occurs commonly when one of the encoder A+ A- B+ B- signals are not connected and floating. I don't know what you mean by "checked". Looked at them by eye? You might check with a voltmeter each of the signals. The signals should switch between >4V and < 0.4V. And whenever a + signal is high the respective - signal must be low. Move the encoder random amounts stop until you obtain all 4 possible A/B combinations.