Of course it was using a feedback loop, but GIGO applies:

   The STT and IRU disagreed on the attitude of the satellite.
   In this case the IRU takes priority, but its data
   apparently was wrong, reporting a rotation rate of 20
   degrees per hour, which was not occurring.

Starting from there it would have no way of knowing about the true value of 'X', so the feedback loop was fed with wrong data and just kept taking decisions† that made things worse, especially given that:

   The satellite configuration information uploaded earlier
   was wrong and the reaction wheels made the spin worse.
   [...]
   the ACS attempted to correct a rotation that didn’t exist.
   The erroneous configuration information led the ACS to 
   aggravate, not correct, the rotation.

† Even without misconfiguration, stopping an object from spinning in a vacuum isn't as direct and linear as accelerating/braking in a car, requiring precise coordination of multiple fixed thrusters and/or reaction wheels.