Try this. Instead of picking a path, right-click on your avatar, scroll down to "Move" in the pop-up menu and select the "Move Forward" sub menu. Then click on any point of the path. The avatar should walk to the near end of the path and then along it.
You can use the same Righ-Click method sans path as well. Just do the same and click wherever on screen you want your avatar to walk to. With no path, the avatar will walk in a straight line.
More specifically, to your issue in that scene, I'm guessing that the "Pick Path" did not assign properly. Curious though, because it sounds like it has worked in a subsequent scene. Try deleting and reloading both the avatar and path. I guess that would be "draw a new path".
Also, have you tried a curved path?
Does the behavior change if you don't project the path to the terrain? You actually don't need to, in most cases.
Here's a video demo. There are a few variations of this as well.