Had the same problem with the same model. After being frustrated a bit I realized the simple fix was to loosen the screws on the bottom of the base that controls the swivel action. The screws were set too tight. You can control the force needed for the swivel action by how loose or tight you set the screws. The assembly instructions are rather poor.
Just setting up a 32" 540 LCD. I noticed when I got the base out of the box the swivel component couldn't be moved with my fingers so I thought it needed more torque. I added the sleeve and small platform that the TV will be screwed to. It's about 6" wide giving me 3" for torque.
I'm going to have to ask someone to help me lift it so I don't want to add the TV to it unless this has been encountered and the stiffness can be overcome with the additional torque from the 18+/- inches I would have to push on.
Curiously on the bottom is a metal flange sticking down that looks like it could be a lock...I can find no info in the setup literature or online.

Chowhound
Comic Vine
GameFAQs
GameSpot
Giant Bomb
TechRepublic