Hi Ben!
So what I' trying to achieve is this text effect seen in some spy movies or in Call of Duty where at the opening of a scene with a new location the name of the city and country let's say is displayed shortly at the bottom left. It's scrambled and decodes in a matter of a couple of seconds revealing the name just like you have it in your project. It's a very cool effect that is integrated into After Effects but is not readily available in FCPX. So this is the workaround. You've done everything right. I have basically the same thing. I really can't send you the non working file or folder because when I set my animation to character without spaces the title never renders out. Motion goes into a rendering loop and I have to force quit it because it doesn't want to do anything else.
My exact settings are as follows: Character offset at 50. Animation: character (without spaces). Spread: 10. Under Text menu for the text layer I have the font parameter set to fixed fonts so that the letters don't move while decoding. And that is all. But really, don't worry if you set it up like that and it still renders out for you. It might be that my MacBook does a glitch or my Motion. Either way I found a way to do it if I set the animation to character, which is ok. I'll just make sure not to leave spaces between the words for the effect. And that'll work because I have cities and countries in mind for the effect which I can separate with a comma. It's a neat effect tho 🙂