Air Conditioning - New A/C unit freeze and room not cool

I just bought a Haier 8000BTU slider casement A/C model HWVR08XC6 for my son's room and this unit gave me a lot of headache. I have installed the unit according to the book, tilted to the back, weather strip etc and it never cools the room below 78F. If I let the unit runs for more than an hour, there is icing collected in a cylinder shape thingy connected to the compressor (I think it is part of the suction line). When the compressor kicks in, I measure the temperature of the high side pipe is 120F and the low side around 70F. It does blow cold air (measured 60F) when the compressor kicks in for a while then when that things starts collecting ice, no more cold air. The unit does blow warm air at the back for a little while then all cool air when that thing is building an ice cellar itself. There is no ice in the evaporating unit and the air flow blowing into the room is good but I can't say likewise to the air blowing out through the condenser fins (Very weak).

This is a brand new unit so there should be no dirt & filter issues and we are in Southern Cal so there is no low temperature problem here (or I wouldn't buy this thing at the first place). I can return the unit to Walmart as a defective unit and buy a different unit like Kenmore from Sears but considering the labor to remove & reinstall a new unit, I want to ask expert opinions before I say enough is enough. What do you guys think what's the problem? A lemon gift from Haier?

Return the unit. It likely has a refrigerant leak or was improperly charged at the factory.

Thanks Jim. I just want to make sure I exhaust all possibilities before returning the unit and exchange for another one.